Fiscal Rescue Operation, Portugal
The objective of the Fiscal Rescue Operation introduced by the Portuguese government in 2008 was the recovery of tax revenues diverted by companies. During the operation, the Tax General-Directorate DGCI recovered €435 million in tax revenues, an average of €1.8 million daily.
In Portugal, over 50,000 companies appropriate the personal income tax (IRS) which is deducted from the wages of their employees or other service providers from the corporate tax (IRC) as well as of the TVA charged on their clients. This kind of infraction leads to high losses for the state and for the Portuguese population in general, and to a distortion effect of the free competition rules.
In the framework of a systematic combat against fraud and fiscal evasion, and in order to ensure more equity and fiscal justice, a new computer information system and a vast operation, ‘Resgate Fiscal’ (Fiscal Rescue) Operation was launched, aiming at the recovery of tax revenues diverted by companies and illicitly not delivered to the state.
The main objective of the Fiscal Rescue Operation is the recovery of tax revenues diverted by companies. In a first phase, the Tax General-Directorate (Direcção-Geral dos Impostos – DGCI) (currently Tax and Customs Authority, Autoridade Tributária e Aduaneira– AT) issues a recommendation to the companies to regularise the situation in a voluntary way. Subsequently, in case the non-compliance persists, the companies will be subject to fiscal actions.
The Fiscal Rescue Operation was implemented in August 2008 with a duration of 12 months. The process involved all the DGCI’s regional and local services.
There are several steps involved:
- the computer system automatically detects, in a systematic and permanent way, the situations of non-payment of taxes;
- the companies are notified regarding the voluntary regularisation of the situation and informed about the possible consequences (at least three notifications are sent);
- the companies are subject to inspection activities by qualified members of DGCI;
- the regional and local services receive specific guidelines for intervention in order to recover the tax revenues unduly appropriated by the companies.
The DGCI was responsible for the Fiscal Rescue Operation. Subsequently, the enquiry files were sent to the Public Prosecutor’s Office.
Outcome of evaluations: lessons and conclusions
Achievement of objectives
- Increased number of taxpayers integrated into the system.
- More equity and fiscal justice.
- Improved efficiency of the fiscal services.
- Enhanced fair competition.
During the Fiscal Rescue Operation, DGCI recovered €435 million in tax revenues, at a daily average of €1.8 million.
About 88% of the taxpayers made payments under tax execution procedures.
The Fiscal Rescue Operation is transferrable to all sectors of the economy and covers every region in mainland Portugal.
- Instituto de Segurança Social, I.P. – ISS, (http://www2.seg-social.pt/)
- Observatório de Economia e Gestão de Fraude, OBEGEF (http://www.gestaodefraude.eu/)
- Autoridade para as Condições de Trabalho, ACT (http://www.act.gov.pt)
- Autoridade Tributária e Aduaneira, AT (http://www.portaldasfinancas.gov.pt)
- Ministério das Finanças (www.portugal.gov.pt)
ACT (2011), Relatório Anual de Actividades 2011 [Annual Activity Report 2011]. Dornelas, António (2010), ‘O trabalho não declarado é invisível?’ [Is undeclared work invisible?], in Dornelas, A., Oliveira, L., Veloso, L., Guerreiro, M. das Dores (orgs.), Portugal Invisível [Invisible Portugal], Mundos Sociais, CIES/ISCTE-IUL, Lisbon, pp 95–107.
Gonçalves, Nuno (2010), A economia não registada em Portugal [The Non-Recorded economy in Portugal], OBEGEF, Húmus edition.
International Labour Office - ILO (2010), Labour inspection in Europe: undeclared work, migration, trafficking, Labour Administration and Inspection Programme LAB/ADMIN. Geneva, ILO.
Ministério das Finanças (2011), Plano Estratégico de Combate à Fraude e Evasão Fiscais e Aduaneiras 2012-2014 [Strategic Plan to Combat Tax and Customs Fraud and Evasion 2012–2014].
Público (2012), ‘Economia paralela subiu em Portugal e vale quase 25% do PIB’, 16 January 2012.
Heloísa Perista, Paula Carrilho and Janine Nunes