Bill approved to oblige banks to inform tax office of €50,000 accounts

By TPN/Lusa, in Business · 14-01-2019 10:14:00 · 0 Comments
Bill approved to oblige banks to inform tax office of €50,000 accounts

Portugal’s parliament approved on its final reading legislation that obliges banks to let the tax authorities known when bank accounts have a balance of more than €50,000.

The bill passed thanks to the votes in favour of the governing Socialist Party (PS), the Left Bloc (BE) and the Communist Party (PCP). The opposition Social Democratic Party (PSD) voted against while the People’s Party (CDS-PP) abstained.

If promulgated by the president, the law would oblige banks to communicate to the tax and customs authority, by each 31 July, information on accounts that, on 31 December of the previous year, contained more than €50,000.

In 2016 the current president, Marcelo Rebelo de Sousa, vetoed a similar bill.

On 9 May last year, after the subject of banking secrecy was raised in a debate by the coordinator of the BE, Catarina Martins, and the prime minister, António Costa, the president issued a statement in which he recalled that he had vetoed a government statute on the subject in 2016 due to the "particularly serious situation experienced by the banking sector".

The following day the government approved the proposal to lift bank secrecy on the deposit accounts of citizens residing in Portugal with a balance exceeding €50,000.

In a press conference, the finance minister, Mário Centeno, made clear that the tax authority would have access to the balance but not to information on movements in the accounts. He also stressed that the legislation did not foresee "exchange [of] information with third parties, national or foreign, private or public".

He described the measure as of "extreme importance for combating fraud and tax evasion" by giving the tax authority an "additional element” to ascertain whether there is evidence of illicit practices on the part of some taxpayers. It would thus serve “as a disincentive to concealment and have an important preventive function," he argued.

However, the legislation spent eight months working its way through parliament, and only emerged from the committee stage on Friday.


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