The EuroState’s insistent snooping into private citizens’ affairs continues with the directive that any bank account in Portugal containing €219,000 or more will be reported.
The directive now is being discussed by Portugal's Council of Ministers but before it finally is approved, the opinion of the National Data Protection Commission will be sought, not that this will halt progress of this C20 initiative.
This is not a Portuguese proposal but is endorsed from the C20 by the Eurocrats in Brussels as a ‘Community Directive’ which obliges member states’ banks to report their high net worth account holders.
Portugal’s banks are preparing to send information to Brussels about accounts held by foreigners who are not tax resident but live in Portugal. The first such report is scheduled for September 2017 and will target both the balances of existing accounts up to December 31, 2015 and those which were opened after January 1st 2016 i.e. all of them.
The twist from Europe is that banks must include account balances of both foreigners and nationals if they have $250,000 or more, or the equivalent in euros.
There is nothing stopping the Portuguese State from setting a lower threshold which will give its tax authority access to just the sort of private information that it might not be able to obtain through debate and voting in parliament.
Currently Portugal’s Finanças can make pretty accurate guesstimates of individual’s bank account balances based on the witholding tax deducted by banks and forwarded to the exchequer. Changes in witholding tax from year to year can show increases in income and cross-referenced with income tax declarations.
With this new move, the Portuguese State will be able to set a limit lower than the suggested $250,000 and have reports sent which list every account with more than the agreed minimum in it.
Portugal’s 2016 State budget ensures that the Tax Authority will be equipped with the tools necessary to monitor the obligation of banks to report account balances.
To cater for a new decree law published last week, the government has increased staff numbers in the Unit for Big Taxpayers which focuses on individuals with an annual income above €750,000 and/or with €5 million or more in assets. The new law will enable tax staff to take a detailed look at a wider base of suspects.
If income drops below the €750,000 level, the taxman will track the individual for a further four years. The previous thresholds were €5 million in income and €25 million in assets.
These moves will ensure that those on the fiddle will move their money or come up with tax efficient ways of using it out of reach of Portugal’s tax authority.
Those who are innocent of evasion but guilty only of being rich, soon will have another layer of privacy stripped away.
