Uncovered Tax Evasion: Over €176 Million in Hidden Revenue in Saxony
Large-scale tax evasion reported in Saxony, amounting to over 176 million euros - Illicit tax avoidance uncovered in Saxony surpassing EUR 176 million
A staggering €176 million in unpaid taxes was unveiled by tax investigators in Saxony last year, the Finance Ministry revealed in response to a parliamentary question from Susanne Schaper of the Left party. This total represents the legally enforceable verdicts and penal orders in local tax fraud cases, as reported by the ministry.
Saxony has consistently seen tax evasion totals in the tens of millions since 2010, except for 2021, which saw a steep rise to €129.2 million. These findings were previously reported by the "Sächsische Zeitung" and the "Leipziger Volkszeitung".
Schaper states, "The real figure is higher."
Schaper was quick to point out that the figure represents successful investigations, but she also emphasized that "this number only includes the cases that the authorities have become aware of - the real figure is higher." She advocated for more personnel in tax investigation, arguing that it would generate more revenue than it would cost. "More importantly," she voiced her concern for the corporate sector, expressing the need for the finance authorities to systematically scrutinize these industries.
The number of reports of tax evasion appears to have remained relatively stable, according to the Finance Ministry: in 2024, there were 8,645 reports, compared to 8,737 in 2023. Previous figures from 2010 to 2014 were in the thousands.
Complexity of Tax Laws
Complex tax laws can create opportunities for evasion, making it difficult for authorities to track and enforce compliance. With Germany’s tax system involving multiple layers of legislation and regulations, it can be exploited by those seeking to avoid taxes.
International Tax Evasion Strategies
The use of foreign entities such as family foundations or trusts has been a strategy employed for tax evasion. This is seen in the German Foreign Tax Act's provisions aimed at preventing such practices.
The Left Party's Advocacy for More Investigation Personnel
Advocacy from the Left party for increased personnel in tax investigation can be viewed as a response to perceived shortcomings in tax enforcement. By augmenting personnel, the party aims to bolster the government's ability to identify and prosecute tax evasion cases more efficiently. This focus could be particularly significant in regions like Saxony, where effective enforcement might address local economic challenges more effectively.
The Community policy should address the need for increased personnel in tax investigation, as advocated by the Left party, to bolster the government's ability to identify and prosecute tax evasion cases more effectively, particularly in regions with high incidences of tax evasion such as Saxony.
Furthermore, the Employment policy should consider the potential increase in revenue from hiring more tax investigation personnel, and weigh this against the costs, in order to enhance the general-news and finance aspects of the business sector, and combat the crime-and-justice issue of tax evasion.
