Mina Business: Interview with the Tax Administration Deputy Director, Novo Radovic
The campaign „VAT is your money“ was initiated for raising awareness of the importance of citizens’ cooperation for creation of a fair tax system, why they were invited to declare all irregularities in business operation of noncompliant taxpayers to the MTA Call Center via the free line 19707, in written form or visiting the Tax Administration premises.
The Call Center IT system enables submission of questions and compaints even out of the working hours, as all of them are recorded and forwarded to the competent services for preparation of answers and making tax audit interventions.
The Tax Administration records and analyses calls and complaints submitted via 19707. Call Center officials daily receive 100 – 120 calls.
Most of irregularities are ussually noted during the tourist season, due to more intensified business operation. In July 2011 citizens submitted 41 complaints, while during August, after the beginning of the campaign „VAT is your money“ this number increased five times – 217.
The Tax Administration officials analyse all submitted suggestions and complaints, making tax audit interventions, for determination of possible irregularities in issuing of tax receipts.
There was only one complaint related to the inconvenience a citizen experienced while asking for a fiscal receipt.
The number of declared irregularities in taxpayers’ business operation, as well as current results of tax collection and audit are the best indicators of the positive effect the Campaign „VAT is your money“ has had.
In August 2011 The total gross collection of VAT was 14,33 % higher (2.244.567,74 €), comparing to August 2010. In the period June – August 2011 VAT collection in southern municipalities (Bar, Budva and Herceg Novi) was 19,81 % higher, comparing to the same period of 2010.
On the national level in the same period there were 238 VAT tax audits, 197 with perceived irrregularities, on the grounds of what 4.217.060,00 € of corrections was determined.
In this period, tax aduitors’ results in southern municipalities were following:
- 1435 offence charges for failing to record the turnover;
- 61 offence charges for failing to determine or underdetermining of tax liabilities;
- 97 decisions on temporary closure of business;
- 42 withdrawals of licence for not complying with tax auditors’ decisions on temporary closure of business;
- 87 controls of correctness in assessing and reporting tax liabilities, on the grounds of what 1.964.604,00 € of clandestine or underreported tax liabilities was determined;
- 212 determinations of the tax base by estimation, upon what the taxable VAT base of 11.618.396,00 € was determied with 1.687.659,00 € of output VAT;
- 43 cases of enforced collection of 398.977,00 € of the tax overdue from earlier period.
The fact that the number of taxpayers increased for 3.049, and the number of registered VAT taxpayers for 1.608 comparing to the same period of 2010 also indicates a higher level of tax compliance and reduction of shadow economy.
The Tax Administration plans to upgrade the Call Center software system in line with the EU standards, for smooth communication with citizens and supplying adequate services to taxpayers.
As the campaign „VAT is your money“ has given positive results up to now, it will be continued in the following period, for promotion of voluntary compliance in Montenegro. It is expected to contribute to the achievement of common interests and strenghtening of trust in tax system of our country.