We live in a country in which people are not aware that taxes must be paid so no wonder that there are 42 billion kuna of overdue liabilities, Finance Minister Slavko Linic said on Wednesday while introducing the draft legislation on a new model for the collection of overdue taxes, due to the economic crisis.
The finance minister said that the previous government's model, under which the uncollected tax debt incurred until 31 December 2010 could be rolled over for up to 30 months, had not yielded results, as illiquidity continued growing last year.
The new model consists of two measures. The first, designed for those who were late in paying taxes last year but can service their liabilities, makes interest write-off possible if the debt is paid within 30 days.
The second measure, for those who cannot pay taxes even if interest is written off, enables them to re-finance their outstanding liabilities until January 31 this year over a 36-month period. After the implementation of the second measure, nonpayment of any tax or failure to service liabilities will result in the blockade of a company and receivership, said Linic.
Linic said that the new model gave huge support to the economy and created conditions for passing in more peaceful circumstances a law on financial transactions with which the government wanted to enable structural changes aimed at solving the debt issue and saving jobs.
Linic said that according to the government's estimates, it would be possible to collect HRK 25.8 billion kuna.
Broken down by the legal status of debtors, 40% are companies, 43% are self-employed and freelance workers, and 18% are individuals in other categories.
As for the companies, as many as 131,000 legal entities are late in paying their obligations, which accounts for 7% of all defaulters. There are 261,000 self-employed and freelance individuals with outstanding liabilities, and as many as 1.3 million individuals in other categories are late in paying their obligations.
"This makes up a list of 1.7 million tax defaulters," Linic said, adding that 21 billion kuna were debts for unpaid taxes, including seven billion kuna of unpaid Value Added Tax, and six billion kuna are unpaid contributions into the first mandatory pillar of the pension insurance. The debt stemming from unpaid health insurance contribution rate amounts to 5.5 billion.
Linic said that the government expected the Tax Administration to become more active in the collection of the overdue taxes.
