Finance ministers from all 16 German states are pushing to implement harsher penalties for tax evaders who decide to turn themselves in before being caught, as there has been some protest over the existing rules which many see as being too soft.
Currently, tax evaders can avoid prosecution if they turn themselves in and pay a 5 percent fine, on top of the 6 percent interest, on sums over 50,000 euros. The new proposal would see the fine double to 10 percent.
Carsten Kuehl, finance minister for Rhineland-Palatinate, spoke out in favor for the increase as in her opinion it “will increase the pressure on tax fraudsters. It should be clear to everyone now that this is more than a misdemeanor.”
This increased interest in the issue comes after Bayern Munich’s former president Uli Hoeneß was sentenced to 3-1/2 years in prison earlier this month for evading 28.5 million Euros in taxes. It was reported that after the conviction, the number of tax evaders turning themselves in rose dramatically. While Hoeneß’s conviction may be seen as setting an example, it also acted as a wakeup call for some government officials.
Michael Meister, Parliamentary State Secretary at the Federal Ministry of Finance, expressed his agreement with the stricter terms, stating that the country “must not allow voluntary disclosures to be an easy way out for tax evaders.”
The federal states will now need to draft up the revised law and submit it for the Bundestag’s approval. Meister’s comments and other feedback from federal officials have so far shown that passing the revised legislation shouldn’t be an issue.