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news 20 Jun 16

Montenegro Minister Faces Grilling Over Unpaid Taxes

The opposition in Montenegro said it had sought a hearing with the Finance Minister over hundreds of millions of euros in unpaid taxes, which the minister is trying to recover.

Dusica Tomovic
BIRN
Podgorica
Photo: Pixabay.

As the war against tax debtors continues by enforced collection of millions in unpaid taxes and by blocking the accounts of some of the largest companies, parliament's Committee on Finance and Budget on Monday will grill Finance Minister Rasko Konjevic and the Director of Tax Administration.

The hearning was set after the State Audit Institution gave a negative opinion of the tax authorities' operations and efficiency.

The hearing was requested by the opposition, which has accused the tax authorities of failing to collect taxes from companies close to Prime Minister Milo Djukanovic.

"The audit gave the opinion that the Tax Administration has not created the necessary conditions for the effective implementation of measures of collection of tax debt, and it does not have the human resources to provide for their effectiveness," the committee chair, opposition MP, Aleksandar Damjanovic, said.

In the last few days, the tax authorities have intensified controls and enforced collection from several of the largest companies in the country. Citing a tax debt of about 900,000 euros, the tax administration has blocked the account of the Alliance of Independent Trade Unions.

The state-run railways, which is also one of the largest debtors, is being pushed to pay off its debt. The management said on Thursday that it had launched the sale of assets that are not directly linked to railway traffic to repay the 3.6-million-euro debt.

The Finance Ministry is moving to finally collect unpaid taxes of about 230 million euros, after an opposition politician, Rasko Konjevic, took the post three weeks ago.

Despite a huge budget deficit that has lasted for years, the Tax Administration has not used all its legal possibilities to collect taxes from several trade and construction companies, some still engaged in important projects in the country.

Meanwhile, the opposition claims that, according to their estimates, the total in unpaid tax rose in June to 552 million euros.

The Finance Ministry has also revealed that real estate tax debts rose to about 46 million euros.

Last week, Konjevic ordered checks into the tax administration's operations in the last two years and said he wanted some "scalps".

He has ordered the management of the tax institution to open disciplinary proceedings into civil servants who failed to collect the debts when they had legal authority to do so.

"We can provide the money for the budget shortfall only in two ways - by borrowing more, though I would remind you that the national debt is already over 60 per cent of GDP - or by collecting the tax debt," Konjevic said.

The Tax Administration in January published a blacklist of 200 companies and individuals who have failed to pay all they owe in VAT, capital gains taxes and taxes on the profits of real estate sales and concessions.

The list of the 100 largest debtors in terms of unpaid salary taxes and pension contributions was also published, showing more them 100 million in debts.

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