Tax Evaders in Bulgaria Beware: Swiss Experts Share Detection Methods
Recent Collaboration between Swiss and Bulgarian Authorities
A recent visit by Swiss Federal Tax Administration experts to Bulgaria has shed light on the methods used to detect and combat tax evasion and fraud in Switzerland, with potential implications for Bulgarian authorities. The delegation, led by Mr. Emanuel Lauber, Head of the Division of Penal Affairs and Investigations, and Mr. Dieter Krähenbühl, Deputy Team Leader of the same division, shared their expertise with Bulgarian officials during a two-day visit.
Understanding Swiss Tax Laws
Lauber explained that in Switzerland, tax fraud and evasion are treated as separate offenses. Evasion is defined as intentionally or negligently understating one’s profits. He outlined the tools used by Swiss authorities to investigate tax crimes, including:
- Interrogation: Typically the primary method employed
- More intrusive means: Used in cases of significant violations
Cooperation between Government Agencies
The Swiss experts highlighted the importance of cooperation between different levels of government and agencies in combating tax evasion. Lauber noted that:
- The federal administration provides cantonal tax offices with access to deeper knowledge about illegal activities
- Provides them with additional investigative powers
Corruption Prevention
Krähenbühl focused on the risk of corruption within the tax administration, emphasizing the need for transparency and democratic approaches to minimize this risk. He suggested that:
- Distributing power among officials
- Avoiding the concentration of power in management
- Using position rotation can help prevent abuse of authority
Bulgarian Authorities’ Interest
The Swiss delegation’s visit was met with interest from Bulgarian authorities, who posed questions on topics such as:
- Determinants for investigating tools
- Transfer pricing regimes
- Procedures for sharing information between tax administrations
Capacity Development
The visit is seen as a significant step in capacity development for Bulgarian authorities, who may be able to apply some of the Swiss methods to their own fight against tax evasion. As Lauber noted, while Switzerland and Bulgaria have different governance structures, there is still a considerable body of transferable knowledge in detecting and tackling tax fraud, evasion, and corruption in direct taxation.
Conclusion
The collaboration between Swiss and Bulgarian authorities highlights the importance of international cooperation in combating tax evasion. The sharing of expertise and best practices can help strengthen both countries’ efforts to prevent and investigate tax crimes.