Treasury stands to lose €5.7 billion in Covid deferred tax

Photo: DutchNews.nl

A lack of staff at the tax office to chase up taxes deferred during the coronavirus pandemic means some €5.7 billion “will possibly be only partly paid, or not paid at all”, government audit office Algemene Rekenkamer has said.

The tax office says it needs at least 400 extra full-time staff for its day-to-day work, while the department tasked with Covid claims needs another 1,000 inspectors.

Some 82,000 companies are in arrears, or not paying at all, with small and medium sized businesses and freelancers making up the bulk of sluggish contributors. In total 210,000 companies currently owe a combined debt of over €14 billion.

The audit office said it expects €8.3 billion to be repaid without problem but that  €2.8 billion will be difficult to recover and €2.9 billion may not be recovered at all.

Recovering debt has been given the “lowest priority” because there are no staff to follow up court rulings supporting sequestering bank accounts and other assets, the department said. Processing objections to fines is also taking a back seat.

The audit office warned that if the money is not actively recovered, more companies will stop paying off their debts and the total amount could be even higher.

Caretaker junior finance minister Marnix van Rij told NOS retrieval measures will “eventually” be carried out.

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