WILLEMSTAD — The government is preparing a sanction law to deal with fraudulent entrepreneurs and storekeepers. The hope is to present this legislation to the Parliament even this year.

 

The law contains an escalation model whereby a fine can be imposed on entrepreneurs or storekeepers and upon repetition of fraudulent actions even the possibility of long-term closing down or withdrawal of the business license.

 

The problem of fraudulent entrepreneurs and storekeepers was brought up again during a meeting of the Permanent Committee Finances of the Parliament last Friday. During this meeting Stichting Belasting Accountantsbureau (SBAB) gave a presentation on the introduction of the sealed cash register system.

 

Although not all entrepreneurs and storekeepers are nowhere near to having purchased such system there is already evidence that entrepreneurs commit fraud and evade taxes also with this system. For instance, from observations on site SBAB (wtp, or inspection) noticed that sales with a sales tax are assessed as 0 percent.

 

It was also noticed that the daily turnover before an inspection was considerably lower than the turnover on the day of inspection. It was further remarkable that sales are registered and subsequently cancelled; when sales are registered at a lower amount on the cash register, the customer receives no receipt; and that due to the inspections shops open later in the morning, close during noon and earlier in the evening.

 

According to SBAB, the loss on sales tax due to these practices amounts to 5.4 million guilders. The loss on income and tax on profits is 6 million. On an annual basis this means a total loss on tax revenues of almost 11.5 million guilders.

 

As preventative measures on fraudulent practices, SBAB suggests mandatory use of computerized invoices. The system of fiscal bookkeeping must also be introduced with all companies and storekeepers so that sales and purchases tally (this is already the case with some companies). Making a reasonable case for costs should be made impossible; customers who don’t ask for an invoice should be fined and perhaps the three different sales taxes should be eliminated.

 

It’s doubtful whether all of these measures will actually be implemented in practice. For example, the system of fining customers and eliminating the three different sales taxes will almost certainly not be implemented. The government is in the process of fiscal system reforms though. Hopefully this proposal will be presented to the Parliament this year. The sales tax, excise duty and import duty reforms will mean less revenues/income tax and tax on profits. However, these reforms involve other cost-reducing measures that are to be implemented. The government is negotiating with the civil servant unions on a package of measures, which also includes increasing the retirement age for public servants from 60 to 65 years. To determine the pension the government wants to switch to a calculation that departs from the middle wage, instead of the final wage. The government no longer wants to index the duration bonus – the compensation for higher living costs – which also forms part of the pension. Furthermore, the VUT-regulation, which makes it possible for civil servants nearing retirement to stop work sooner, will be rescinded. The package also departs from freezing the indexation of the salaries of government personnel for a period of two years, while the holiday allowance and the indexation of wage levels will be halved. Besides economy measures the package contains measures with which the government wants to compensate the civil servants.

 

Another cost-reducing measure is the rental costs of buildings. The rental costs of various buildings will be kept down considerably with the construction of a central building that is to house most of the government services.

 

(Amigoe)