IF the estimated €6 billion of ‘black’ money currently in circulation in Malaga Province was to be declared, the Spanish Tax Office would be €600 million richer.
According to the Secretary General for the General Workers’ Union in Malaga, Manuel Ferrer, this money alone could pull the province out of the financial crisis.
Ferrer said that the “fiscal amnesty” approved by the government last week is “irresponsible” as money declared between now and November 30 will only be taxed 10 per cent, and money obtained abroad with eight per cent, without any other fines or interests being applied.
Tax officers reportedly believe that the plan will be an “absolute disaster.”
Those who make the confidential declaration of their taxes, will actually pay less than if they had done it up front in the first place.
The amount which could be “hidden” in Malaga is just 10 per cent of the €6 billion thought to go undeclared every year.
However, the government announced that they expect to uncover just €2.5 billion in the whole country.
According to the Tax Workers’ Union, the amount of ‘black’ money in Malaga is estimated to be 22 per cent more than the province’s Gross Domestic Product.
It is said to have risen 33 per cent in the past 10 years, mainly due to tax evasion in the construction sector.
The financial crisis has also increased the amount of business being carried out without declaring taxes.
Seventy-two per cent of the estimated €6 billion undeclared money in the province is in the hands of people and corporations with large fortunes and most of it is in tax havens abroad, the Tax Workers’ Union reports.
They believe the new ‘amnesty’ reflect the government’s admission that the Tax Agency is “incapable of controlling the country’s hidden economy.”
By Jennifer Leighfield