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Anti-avoidance measures against tax fraud and major economic and financial crimes adopted by Council of Ministers — Orbitax Tax News & Alerts

On 24 April 2013, the Council of Ministers adopted a bill which would implement a new set of anti-avoidance measures to fight against tax fraud and major economic and financial crimes). The bill follows the pattern that the government undertook in the previous two Amending Finance Laws for 2012. The bill will be subject to parliamentary discussion. The main measures are summarized below.

Strengthening of investigativepower

-   The jurisdiction of the police specializing in tax investigation will be extended to money laundering. This "tax police" will be part of the future prosecuting office for major corruption and tax fraud.
-   The tax authorities will be able to perform a tax audit or prosecution based on information of illicit origin. However, this information must originate from the judiciary or the administrative assistance procedure.
-   The seizure and confiscation regime of criminal assets will be strengthened. It will include the possibility to seize life insurance contracts or property owned by the convicted person.
-   Organizations fighting against corruption will be entitled to exercise the rights of the plaintiff before a court.

Hardening of penalties for tax fraud

-   The bill proposes to implement a substantial aggravation of penalties applicable to serious crimes such as:
-   tax fraud committed by an organized group; and
-   tax fraud based on the use of bank accounts or foreign owned entities, such as trusts.
    For these cases, the penalties will be increased from 5 years to 7 years imprisonment, and from EUR 37,500 to EUR 2 million.
-   Legal entities will be subject to the same penalties as those applicable to individuals. Consequently, as an additional penalty, a legal entity's assets may be seized if convicted for money laundering.