Sunday, October 9, 2016

Fact Check: “tax relief” of the PS is different to that of Steps? – The observer



"The program has very few parallels [with the plan of the PSD/CDS]"

Fernando Rocha Andrade, the secretary of State for Fiscal Affairs, in the Parliament, explain the differences and similarities between the program of debt settlement now appear with the socialist Government and the plan presented by the Executive of the Steps.


When, in 2013, the Government of Pedro Passos Coelho introduced the program RERD (Exceptional Regime for Settlement of Tax Debts and Social Security), which provided for the forgiveness of interest and costs administrative who regularizasse debts to the tax authorities and Social Security, socialist, bloquistas and the communists were quite critical of the Executive branch PSD/CDS: "Advertising" and "staging", cried the left. Steps and Doors approached with a "tax relief aimed at taxpayers in general Portuguese" to fix the budget execution, summed up the deputy of the socialist Eurico Brilhante Dias. Three years later, is the time of the socialist Government to submit a plan of the same nature. And the right does not forgive: "Dropped the mask to the Government". The arguments are exactly the same.

What is the position of the PSD? For the social democrats, the socialist Government is repeating a recipe that both criticized to capture additional revenue this year through an extraordinary payment of debts. Goal? the Save the budget execution.

"All the Portuguese had already understood that the implementation of the budget for the present year was not running well. The Government finally recognized-the. And recognized today to admit that you need a extraordinary revenue. Dropped the mask to the Government", argued the deputy of the PSD Duarte Pacheco, in statements to journalists in the Parliament.

And that answered the HP? Fernando Rocha Andrade, secretary of State for Fiscal Affairs, pointed out the differences between the two plans and ensured that this is not a measure extraordinary. If it is true that part of the debt that individuals and companies have with the tax authorities and Social Security can be completed already this year, the introduction of payment by instalments — up to 11 years old — dilutes that possibility. "This program is not fattening the tax revenue in a year and allows you to stop executions and liens in course and free the treasury of the companies. It is a profound difference that explains why it is that the other measures were poor, and this is good," said Rocha Andrade.

But if the measure does not concentrate on the collection of revenue in this year, ensures entry of funds in the coffers of the State in 2017 and the following years.

The lawyer and the ruler admitted that he still does not know how much you can raise with the measure. "It is odd that they consider to be a measure of the extraordinary to this year, because some of the (debt) can be paid this year, another might be later. I do not know what will be the membership. the I’m Not sure if it will allow you to ascend or descend the recipe this year".

it Was even strengthened João Galamba this Friday in the Parliament: "In relation to the [scheme] of 2013, there are two very significant differences: first, the plan healthcare benefits, or is not intended to raise revenue in the short term, but to provide conditions to enterprises and households so that they can pay over time. Another difference is that, in 2013, in certain circumstances, there were amnesties to tax for fraud, or some crime tax".


Let’s go by parts. Or not there are similarities between the two plans?

The answer is yes. The one that proposes the socialist Government with this new law? In general lines, the companies and individuals that have debts to the Tax Authority and Social Security will have to pay all the taxes in debt. But, if you adhere to the plan drawn — PERES (Special Program of Debt Reduction to the State) – will be able, if they so desire, pay in installments up to 11 years, with relief or even exemption of interest and no costs of the proceedings. Out of this plan are, however, cases of fraud and crime tax.

In case you opt for payment by installment, the tax payers must be applied to the head 8% of the value of the debt.

And that was for the regime that the Government PSD/CDS approved in 2013? Provided for a "forgiveness" for taxpayers who had debts to the tax office and the Social Security system, exempting them from paying late payment interest and compensation, expense administrative and charging fines low if you accept to regularize their situation. The RERD also provided for a reduction of nes for delay in delivery of claims to 10% of the amount of the statutory minimum, provided that the obligation missing was regularized and charging a minimum value of 10 euros.

In the background, one can argue that the spirit of the two schemes is similar: to give the debtors a possibility of regularizing their tax situation to invest in and have access to community funds, while at the same time boost short-term tax revenue, even if the current Executive does not take this objective. But with a fundamental difference to the socialists: the plan designed by the previous Government made no provision for formally the possibility of payment in installments.

And now: the PS criticized the program of the Government PSD/CDS? And the left?

The answer to both questions is yes. In October 2013, the socialist Eduardo Cabrita, today deputy minister of António Costa, had accused the previous Government of using the tax relief as a "hours budget vista short" that reinforced "the sense of injustice and the withdrawal of credibility" to the Executive.

The socialist used a term which today reject: the "tax relief". And here there are big doubts: the two schemes only forgave the interest and the costs of the proceedings, irrespective of the question of benefits. the If the program Steps could be called "tax relief", this also.

And the Left Block? In 2013, the reaction of Pedro Filipe Soares was perentória: "This tax relief cost a submarine. The leader of the parliamentary bloquista accused the majority PSD/CDS of just going to sleep "when he forgives some and goes to the pocket of all."

Three years later, in an interview to SIC, on Thursday, the leader of the pack held position: "The Left Block has never been favorable to these pardons tax and not changed his mind," said Catarina Martins. "[The pardon] would be used to compute the revenue deficit for Europe". The party still has not ruled formally on the measure, unlike HP and PCP.

going Back to 2013. At the time, Paulo Sá, PCP, accused the PSD and CDS try to mask the numbers of the deficit using a "tax relief" is extraordinary. In the background, it was a "staging mounted by the Government around of the deficit to make believe to the Portuguese that the sacrifice has been worth, aiming the most brutal austerity measures".

Three years later, reacting to the proposal socialist, the same Paulo Sá has clarified the party’s position: "that the Government now announced is a programme of extraordinary settlement of the debt to the State Tax authorities and Social Security — which does not provide for any forgiveness of the capital. In other words, all debt must be paid in full, providing for exemptions from fines and interest in the case of immediate payment or a partial exemption in the case of be done the benefits". Already the special regime approved by the previous Government, argued in the communist, only included those who could pay the full amount of the debt, was in force during a particular period, and regarded the amnesty of the crimes of tax.



In general, the two programs are of the same nature. Even Fernando Rocha Andrade acknowledged in the Parliament that there are some parallels between the two measures. But there is a difference that the socialists do not fail to remember: the introduction of payment in instalments. the fact, this mechanism was not provided for in the previous scheme.


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