That’s ok for the big players with deep pockets. For the little guy this is a much bigger problem. As it should. It would just be nice if law breaking would be a bigger problem for the bigger companies too.
I misfiled stuff a few times and got fined, it's annoying but it's not something that will break your bank.
The behaviour of the tax office varies quite a lot from country to country tho.
Each time I got a piece of mail asking my to call the IRS to clear it up, and every time the agent was nice and very helpful clearing it up, and not fined.
But don't trust me, ask your lawyer.
New Zealand. The Accident Compensation Corporation, a compulsory insurance scheme, is absolutely feral. Will crush you "because rules" without a thought.
Many an varied
I was once charged $1200 for income of $600
Within the rules, could've easily bankrupted me
The reason executives commonly avoid such penalties is because they avoid being found personally liable by claiming they didn't known, did misunderstood the situation, where deceived by others etc.
Through it should be noted that this case is a bit unusual and complicated. The tax dispute itself isn't as simple as Amazone directly having avoided paying their own taxes. And the case of missing taxes has already been settled. This new current investigations are criminal investigation (i.e. the failure of paying taxes is assumed to have been intentional instead of a booking error) and seem to be more targeting executives for having committed crimes (instead of targeting Amazone the company).
Or in other words, Italian prosecutors are feed up US companies not caring for EU law and no one being hold liable.
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(1): Without option to have it replaced with long time parole.
In the US, Section 302 of the Sarbanes-Oxley Act exists literally to avoid this: the CEO and CFO have to personally sign filings so they cannot "not know" about financial disclosure content and have plausible deniability. While it only applies to public companies, the model seems reasonable to solve this case too.
But this comes back to how thinks always tend to be more complicate then "clean cut direct tax avoidance".
E.g. here the case isn't as simple as Amazone directly avoiding tax. But them instead to quote:
> Amazon's algorithm and operating models enabled the sale in Italy of goods from tens of thousands of non‑EU sellers - mostly Chinese - without disclosing their identity, helping them avoid paying value‑added tax (VAT)
I.e. Amazon is seen responsible for acting with sever levels of negligence with suspicion of intentionally enabling/supporting tax evasion to profit from it. (And honestly given the level of fraudulent-looking things Amazone allows vendors since a very long time, there is likely some truth to the "intentional supporting malicious actions" part.).
And in turn executives don't claim exactly "they didn't know". They claim they did know and started actions to fix the issue but it the actions failed so you tried other actions and if asked why no bigger actions are tried they claim it didn't look like it was "that" big of a problem through they now realize that was wrong.
The end effect is still the same they doge responsibility as-if they could just claim they didn't know, just with extra steps. Instead of "didn't know" I probably should have used "they claimed incompetence" (and external factors outside of their control) or similar.
Your entire post comes town to "oversimplified", to frame it generous. To frame it factual: misinformation.
> technically such things exist in many countries, most likely also Italy.
Yeah? Which ones? Quote the sections and then we'll continue ...
but also overlaps with other laws, e.g. wrt. failing to act in due diligence
(other laws) like you are legally required to act with due-diligence, as CFO this inherently means knowing about the finances of the company so even if you claim you didn't know it's not exactly changing anything as not keeping up with your due diligence still makes you as likely
There's o EU wide tax law, so that statement is misleading at best and there's many places where that's false. You're spreading misinformation.
> The reason executives commonly avoid such penalties is because they avoid being found personally liable by claiming they didn't known, did misunderstood the situation, where deceived by others etc.
Misinformation again. This blanket statement in just false. Again, because there is no EU-wide law. It's up to the countries and they handle it very differently.
Businesses who get into trouble because of taxes are doing it intentionally. Or somebody in the company does it intentionally.
On this occasion, however:
> In all previous cases involving other international groups, once a settlement was reached and payment made, prosecutors closed related criminal investigations, either through plea deals or by dropping the cases.
> This time, however, Milan prosecutors did not share the tax authority's approach and decided to press ahead with their probe, leading to a request that the suspects be sent to trial.
It’s crazy that executives can jump around the law and not face any criminal charges, then the company picks up the bill (although I’m not ignorant thinking this isn’t usual)
I’m just curious to learn more about how often this is the case and you usually what happens with people afterward
as far as I understand the criminal part still considers intent and so on (and has a higher standard for burden of proof), but if you file for VAT return and then you have zero invoices (and so the numbers simply don't add up) the court can easily find that there was intent to defraud the state. (and then sentencing is based on the amount of damages.)
- we want 1.4B, but it will take 10 years in courts
- best I can do is 800M (or even lower)
- ok, we'll take it
My mother's husband owed 70k+ EUR in taxes and at some point the judge proposed and he agreed to 2800 euros.
The trick is to not have a bank account in your name only, you have it joint with a child/spouse and they can't take your money. Nor they can take your house, if you only have one.
Eventually under those situations the judges try to take anything rather than nothing.
I'm not defending this situation, just saying it's widespread and the fact that every two governments come one that does a "condono", which is essentially "let's agree with tax evaders for some 50% of the tax they owe so they are happy and we see something" doesn't help.
Harsher punishment should be warranted, but you can't go to prison for tax evasion.
Yes they can take 100% of your part of that bank account which amounts at total / # of owners.
I said can't, not shouldn't.
In any case I'd still say it's arguable if the punishment matches the crime, I'm not saying I'm against it but I don't fully buy it either.
In Italy we have two law codes: criminal and civil. You can't go to prison for civil offenses like tax evasion in our system.
Justice is independent in most EU countries.
I am occasionally called upon by the local consulate to perform my civic duty and vote.
Just this week I sent them back my ballot, now marked, for this referendum in a sealed envelope.
This referendum required me to dig more deeply than usual into Italian politics before I could decide which way I wanted to vote.
Ask any Romanian and they'll tell you they're not. Ask them about the Mario Iorgulescu case [1], with the Italian justice system refusing to extradite him here to Romania only because his (wealthy) dad paid the right people off. And Iorgulescu is not the only such case.
[1] https://www.romaniajournal.ro/society-people/law-crime/mario...
Is this some indirect effect of that?
Namely, it also changes the self-regulating body (the CSM, Consiglio Superiore della Magistratura) of the judiciary so that the government and parliament have a bit more authority and the judiciary have a bit less: the organ is split in two, its judiciary members are no longer elected but picked randomly while a part is decided by the political side, and there's an even higher special tribunal.
Proponents say this is necessary, opponents say this is leading towards stronger power of the political majority over the judiciary.
Now, roughly one third of CSM members is nominated by the Parliament and the other one is elected by judges, according to the "correnti" (a sort of parties)
Italian here. It's not like that: the referendum is about definitely enforcing the career separation about public persecutor and judges. Actually they are under the same authority and the member of this authority are elected according to a sort of political parties (unique case in the whole EU) and this creates some distortions in career growths and nominations. The new schema will create two different authorities and the members will be selected according to a ballot.
A similar proposal was made by the left wing parties few years ago, when they were at the government
If this is just from foreign sellers operating on amazon.it, then 1.4B of evaded taxes sounds like a lot to me, because the total revenue should be well under 50B/y, so this would be a significant fraction of total sales tax (and I'd expect most sellers to not be foreign and thus unaffected).
Would be quite nice to see rich people held accountable for once, curious how this will go.
Most sellers probably are foreign.
A regular citizen doesn't pay tax: lets jail or deport you, bar the entry for a decade, take away your home, car and anything you own in general and make you unable to find job for the rest of your life. Also your tax is double that of the billionaire, glhf ;) .
> In percentage terms this means that during the 1970s between 15 and 20 percent of Italians evaded taxes while the rate climbed to 26 percent in the 1980s. In the 1990s, tax evasion fell again, hovering between 15 and 20 percent. Workers employed in manufacturing evade very little, whereas the highest evasion rates can be found among the self-employed
> The severity of evasion becomes obvious when we consider that the Italian state annually collects only a total of €350 billion while losing €250 billion through evasion (D’Attoma 2016).
> If one asks Italians why they evade taxes, they primarily say that they evade because everyone else does so
> A distant second is the reason that Italians would be more likely to pay taxes if they had the feeling that the state would spend their money more wisely. Much lower in the ranking come issues such as the soft penalties for evasive behavior, the complexity of the tax rules, and the unlikeliness of being caught. A total of 87.1 percent of all Italians think that their fellow citizens evade taxes
Big companies have the opportunity to make tax elusion (there is a reason why many Italian companies have legal HQ in Netherlands or Luxembourg), small companies, artisans and freelancers usually avoid to pajly VAT