Report: tax evasion is estimated at 24% of GDP
By
Mohammad Ben Abderrazek | 1 hour ago Aug 19, 2022
Whether it is tax evasion or tax evasion, Tunisian legislation is intrinsically flawed in the fight against these two scourges. On the contrary, everything leads us to believe that the absence of effective tax reforms in recent years does not has only strengthened them, says a
report published by the Tunisian Forum for Economic and Social Rights (FTDES).
According to the report entitled “Inequalities in Tunisia
”, tax evasion alone is estimated at 25 billion dinars, equivalent to 24% of GDP . The tax privileges enjoyed by the 400,000 liberal profession taxpayers eligible for the flat-rate tax system are the source of massive tax evasion.
On the other hand, according to the FTDES, lump sums only bring in 0.2% of tax revenue, i.e. an average individual contribution of 79.2 dinars in 2010, 42.2 in 2011, 59.2 in 2012 and 55.7 in 2013. Among these taxpayers, only 40% declare their income within the legal deadlines, 10% do so following notifications from the tax authorities and 50% do not even declare their income to the tax authorities.
It is emphasized, in this regard, that this haemorrhage benefits the wealthiest and most influential people at the expense of the most vulnerable who bear the brunt of a continuous deterioration of the essential services provided by the State and obtain in return no fallout. direct finance. Companies have benefited from tax incentives which are the reciprocal of a gradual and persistent decline in corporate tax receipts.
On the other hand, we note that the multitude of tax exemptions for the benefit of companies (in particular the reduction of the general rate from 30 to 25% decided in 2014 and the link between the IS rate and the turnover decided in 2018) as well as massive tax evasion mean that today
corporate contributions represent only 10.5% of the total tax revenue provided for by the 2021 finance law.
In addition,
46% of companies subject to income tax have not declared their taxes according to estimates by the Ministry of Finance , which, according to the forum report, lifts the veil on massive tax evasion and further reduces State resources and its ability to guarantee basic services that meet the aspirations of the population and the poorest (Oxfam, 2020). Because of the dysfunction of the corporate tax, Tunisia loses annually about 257 million American dollars (US dollars), that is to say 720 million dinars, according to the Global Alliance For Tax Justice.
It should be noted that the international expert specializing in budgetary policy at the International Monetary Fund (IMF), Patrick Petit, confirmed during a meeting with the Minister of Finance, Sihem Nemsia, on August 11, the commitment of the institution international financial institution to support Tunisia in terms of tax reform.
Petit highlighted the desire of the various local stakeholders to develop the tax system in order to boost the business climate, consolidate state resources and improve Tunisia's position internationally in terms of attractiveness of investors.
The Minister of Finance expressed, for her part, the authorities' commitment to continue the reform of the tax system, to put in place adequate mechanisms to simplify it and to give concrete expression to the principle of tax fairness, in particular through the mod
ernization of tax administration and the digitization of services provided to taxpayers.
As a reminder, Patrick Petit paid a working visit to Tunis as part of the technical cooperation program between Tunisia and the IMF to reform the tax system which is part of the government's major reform programme.
Qu’il s’agisse de fraude fiscale ou d’évasion fiscale, la législation tunisienne est intrinsèquement défaillante dans la lutte contre ces deux fléaux, au
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