– The tax authorities’ attitude towards entrepreneurs has always resembled a hunting pursuit. Governments change, but there is no shortage of hunters. This time, the state shifts responsibility for its failures in combatting VAT fraud to companies and orders businessmen to do its job: namely to investigate the reliability of contractors. Those who fail to investigate properly will be punished and have to pay – President of Employers of Poland writes for “Rzeczpospolita”.
– Once, under the guise of decentralization, the responsibility for all contentious issues, such as hospitals, schools, crisis management and the like, was shifted to local governments. Apparently, now it is the entrepreneurs’ turn – Malinowski assesses.
– Let me tell you straight away: chance for success are slim. Surely you know the catch 22 mechanisms from Joseph Heller’s brilliant novel? Yes, catch 22 has just been applied to you! If any irregularities are uncovered in the long chain of VAT transactions, the tax authorities will rule that it is you who did not conform to the principles of due diligence. What are these principles? Nobody knows, as there is no definition. Catch 22 trumps all – he warns.
Malinowski stresses that the state offers no support in this regard. No data, no administrative support, much less a refund for the costs of control. Furthermore, trade secret is another obstacle and the ruling of the EU Tribunal of Justice from October 2015 clearly shows that entrepreneurs cannot spy on their contractors.
– If inspectors really are not competent enough to deal with VAT fraud, placing the responsibility for it in private hands seems to be a decent idea. However, it should be done openly, with respect for market principles, eg. with a tax deduction for properly verifying a contractor, provided that companies are given appropriate tools and authorizations – summarizes the President of Employers of Poland.
The article in full is available in here.