The failure of the inducement by Finanças in rebating a small percentage of VAT paid by consumers buying meals, accommodation, haircuts and car repairs has now been laid bare.
Last year just 6.6% of the 614.3 million invoices in the sectors covered by the scheme were issued with tax identification numbers added, the tax department therefore seems right to change the scheme for 2014 by adding the lottery incentive. As before, 15% of the VAT rate of purchases at restaurants, car garages and hair salons can go towards reducing a taxpayer's income tax if the receipt is registered online.
The natioon soon will have a lottery style car give away, but will the overall registration of receipts increase or are consumers on the side of the retailer and against the government’s increasing incursion into the nation’s business activities?
The 2014 lottery scheme with cars as prizes can be entered by anyone buying anything as long as they then enter the receipt on the Finanças website, and as long as the retailer was asked to produce a receipt with the purchaser’s tax ID number on it.
This is a better scheme than restricting the purchase categories as in 2013, and the new lottery game apparently is now open to all purchasers of any type of goods and service.
The prizes are cars seized by the tax office for non payment of debts to the state. This seems a good idea as these prizes do not cost the government anything, or do they? In fact these vehicles have been seized in lieu of debt so this debt must be written off in full by the taxman if the asset is being given away as a prize.
If a car had been auctioned by the state rather than given away as a prize, the former vehicle owner might have received any balance if the auction price achieved was in excess of his debt to the state. This can no longer happen.
When the details of the car lottery scheme, scheduled to start on January 1st but already delayed, are publicised these grey areas should become clear and it is hoped that nothing ‘unconstitutional’ has been devised by the taxman, under pressure as ever to stop tax cheats.
