PM Robert Fico. (source: TASR)
The author works at the Let's Stop Corruption Foundation.
Facing the need to save the state treasury, which is really in bad shape, the government announced that it is going to drastically raise taxes and introduce some new ones.
What the government does not brag about, but actually downplays, is the fact that it has also opened its arms to tax evaders. By changing the Criminal Code, the government made Slovakia a de facto paradise for tax fraudsters. And so, with one hand it wants to fill the state coffers, into which the other hand made a big hole allowing for outflow of money.
The VAT increase should bring more than €1 billion to the state. The current tax gap, which shows how much VAT escapes the state, is somewhat smaller. Reasonable politicians would certainly push for the least amount of tax evasion and penalise tax fraudsters for the benefit of all responsible.
Slovakia - a paradise for tax fraudsters
However, the reality of Slovakia is that the tax fraudsters actually have a wider window of opportunity. Currently, it is not even a crime when a speculator requests a VAT refund from the state based on a fake invoice of up to €100,000.
For comparison, most self-employed do not reach such a turnover even in a whole year. In other words, several small self-employers will have to pay taxes for this one fraudulent VAT refund.
Moreover, the hype surrounding the tax increases suppressed the information that instead of a drastic lay-off of civil servants, the state will dismiss far fewer.
Fico: A third of public servants are useless
Half a year ago, the prime minister emphatically declared he would cut a third of the civil servant posts, saying: "A cut of 30 percent would not be visible at all, and the ministries and state administration bodies would still perform the same, maybe even better than now."
Currently, only 10 percent of civil servants are being dismissed, a fact that does not seem economical in the face of the current state coffers.
In addition, if one takes into account the creation of a completely new ministry, or the creation of new functions such as the government's 'Covid-19' commissioner, the number of officials for next year may be basically the same as it was at the beginning of this year. So no real cut.
The state budget is not a letter to Santa, in which politicians write their unfulfilled dreams. The government should manage public money in such a way that the state works as well as possible for everyone, not only for itself and its voters.
Otherwise, there is a risk that our children's children will continue to pay for these dreams, and there is a growing space for speculators who lobby so that no money is spared from them.
©Index
