Posted May 10, 2014 by John Baintree in News

Slovak Authorities Turn to Gambling to Cut Down Tax Avoidance


And you thought you’d seen all the headlines and that nothing could surprise you! Well, get a load of this.

Like most countries, Slovakian tax authorities face a never ending battle to persuade citizens to cough up their fair share of tax. In particular, authorities are concerned about those businesses that sell goods and services direct to customers. The restaurants, the shops, anywhere that goods and services are purchased level Value Added Tax at 20 percent onto the sale prices they charge, becoming unpaid tax collectors for the Slovak government.

The concern with all sales taxes of this type is that it does rely on the honesty of the relevant merchant to declare sales correctly and this has proven to an issue among the corridors of power in Bratislava.

Cue this great wheeze! There is now an official policy to encourage customers to snitch on retailers. Each receipt issued carries a VAT reference number and customers are encouraged to enter the details of the goods they have purchased into a national database which provides tax authorities with the information they need to double check a retailers VAT return.

Why on earth would disaffected citizens (show me a western state where the citizens are not disaffected at the moment) bother entering the details onto a website in the first place? Not only does it feel underhand, but who could be bothered to spend the time doing it. Well, there’s always the incentive. What incentive I hear you chorus.

Check this out peeps, for every receipt you enter into the National Snitch on Your Favourite Retailer Database, you will be given a single entry into a lottery. Run monthly this lottery offers punters the chance to win €10,000, a brand new car or wait for it, a chance to appear on the country’s version of The Price is Right, essential TV viewing on a Saturday Night.

The whole idea is perhaps not as alien as it might sound as declining tax revenues from VAT have forced authorities to act. Traditional inspection led efforts have begun to see revenues being clawed back but they are very slow and the lottery solution is designed to increase the speed at which the sinners in the world of Slovak business are identified.