There are 218 individual taxpayers with debts to the taxman of over €1 million each but the total is down on last year’s by 18 people.
The list of all tax debtors shows 28,000 people with debts of more than €7,500 each as the State machine relentlessly rolls on in trying to collect debts, many of which clearly are never going to be paid.
Many sole proprietors and managing partners of businesses are being hounded for business debts but Domingues de Azevedo, the head of Portugal’s accountancy body, says that most of these people have been on the list for years and are unlikely to suddenly start paying up.
The Tax Authority has published its festive list for the end of 2015 which shows also that more than 1,100 people have debts of over €250,001.
The total debt to the taxman from companies and individuals is as hefty €6.5 billion, the equivalent to 3.5% of GDP, much of it unrecoverable as the person or company has declared bankruptcy and will avoid disclosing assets if there are any left to disclose.
The list of shame was established in 2006 by Teixeira dos Santos, the Minister of Finance in the José Sócrates government, in an ultimately fruitless attempt to control the number of debt collection actions clogging up the court system.
The theory was that people would pay up rather than risk being shamed by having their name published.
Before someone’s name is published for all to see, debtors are of course told to pay up. Those that will not, or simply cannot, have their names published but few seem to care these days.
The same goes for companies with large debts. There were 13 at the end of 2015 each owing amounts greater than €5 million, little of which will ever be recovered.
"A company that reaches this point is already out of control. Its viability is compromised and for the payments to start happening it is necessary to find a way of resuming cash flow," according to Domingues de Azevedo who added that this is why the PER system was introduced, to come up with a formal way of keeping creditors at bay while the company is rebuilt.
Azevedo says that this PER ‘special revitalisation’ scheme is not enough, "there is a great ocean of companies and people in big trouble. That's why half of the debt of €6 billion will never be collected."
The stiff interest rate charged by the tax department on overdue loans also is a disincentive to play fair. At 6%, Azevedo suggests that it is cheaper to get a bank loan at 2% or 3% to pay off the taxman, surprisingly forgetting that the vast majority of debtors already will have exhausted all lines of credit.
The companies owing €5 million or more are -
A. Oliveira Santos
Boavista SAD
Euroamer
Carlos Teixeira da Silva & Filho/Califa
GMOF
Iberouro
Kroning
L.Rocha/Beltrónica
Lin Lines Incorporation
Metalmonda
Sociedade de Investimentos Colinas Darge
Valosmetal
Yonash
The list of tax debtors, both personal and corporate, is at
http://www.e-financas.gov.pt/de/pubdiv/de-devedores.html
