Tax cheats face assets freeze

The National Council for Peace and Order has agreed to a draft bill authorising the Revenue Department to freeze assets of those allegedly involved in tax fraud.

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The department will be able to block all financial transactions by suspects at domestic financial institutions, director-general Prasong Poontaneat said.

The bill will also allow department officials to take over police tasks in launching tax fraud probes. Should the bill become law, it will offer more flexibility to the department to chase unpaid tax from fraudsters and their accomplices, he said.

The Finance Ministry is seeking to boost tax revenue after its collection has fallen far short of its target. Improving officials' efficiency in tax collection, stemming loopholes to guard against tax avoidance and frauds, and imposing taxes on new items are among the measures.

The Revenue Department's chief recently said it would do its best to achieve its tax collection target of 1.89 trillion baht for fiscal 2014 and should not miss the target by more than 100 billion or 5-6%.

It gathered 1.55 trillion baht during the first nine months of the fiscal year, which was 93.5 billion or 6.6% short of the target.

Tax fraud is not covered by the National Anti-Corruption Commission's predicate offences, so tax-collecting agencies have no tools to block financial transactions of those suspected of tax fraud, lowering the chances of recovering unpaid tax, said Mr Prasong.

The 11 predicate offences under the Anti-Money Laundering Act include drug trafficking, sexual offences, gambling, smuggling and terrorist activities.

Clear evidence of failure in getting back unpaid tax was a 4.3-billion-baht value-added tax (VAT) refund scam. Without authority to block transactions of those alleged to be involved in the scam, the Revenue Department has failed to trace the tax.

An initial probe by the Finance Ministry's inspector-general found that 18 officials may be involved in the VAT scam. Four held positions of senior director or were specialists at C-9 level, while the rest were operational officials.

However, only five outsiders have been charged in the case involving steel scrap, while all officials escaped charges.

Mr Prasong said the draft bill must be approved by the National Legislative Assembly.

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