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Tuesday, 26 October, 2021
Home BUSINESSGovt mulls money-whitening opportunity for tax havenists
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Mon, 08 Jun, 2015 12:00:57 AM
FTimes- STT Report, June 8
 
File Photo Lehtikuva.
The government will give tax payers a fixed term next year to inform the tax administration about revenue that may have remained uncollected.
 
As envisaged, tax havenists could bring their money to the country and escape criminal liability in the process called active repentance.
 
The proposal tabled at the government programme was the brainchild of the previous government.
 
The then finance minister, Antti Rinne tried to push for the active repentance programme, but, according to Rinne, the Ministry of Justice lacked sufficient resources to pursue the matter to the point of legislation.
 
“This is not an easy question, but as a whole active repentance is a sensible way to collect tax revenues,” Rinne said.
 
Mikä Lintilä, who was in the taxation group which produced the government programme, said the active repentance programme is designed for a fixed period in 2016.
 
However, continuation of the programme will not materialise.
 
“Of course, this is a moral problem, when people have been operating in the grey area. On the other hand, the government will not gain any returns without the programme,” Lintilä said.
 
Hannu Kuortti, a senior officer from the tax administration, favours a fixed-term programme to one which is permanent.
 
“A permanent programme could be risky. Particularly, during a weak economic situation, it should be considered whether it is worthwhile to declare the revenue, before a higher risk of being caught,” Kuortti said.
 
In Sweden, the active repentance programme has long been in use.
 
For example, in the period 2010-2013, the programme brought Sweden an additional tax revenue totalling 150 million euros. 
 
As such, in Sweden, one is exempted from criminal charges and tax increases in case a person makes a declaration by own initiative.
 
According to Lintilä, the active repentance would be subject to tax increase; however, the possibility of its relaxation would be explored later.
 
The government would enjoy the direct benefits of higher revenues in the long term, after investments become subject of permanent taxation, asserted Kuortti.
 
According to Kuortti’s estimation, properties would be returned back to Finland from countries such as   Switzerland, Liechtenstein and Luxembourg and similar states where obtaining tax information has been difficult.
 
Lintilä revealed that he had received personal inquiries from accounting companies whose clients are interested in the programme. 
 
Those clients had, for instance, sold the operations of the companies and the money they received was transferred to accounts in countries such as Liechtenstein.
 
“Now people do not want to pass the burden to their children. Rather, they want to return the money back to Finland by paying taxes and tax increases,” said Lintilä.
 
All the interviewees agreed the evasion of the consequences of negative publicity would increase the popularity of active repentance.
 
 
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