Authorities ‘wage war’ on global tax evaders

recruitment agency advice

21st August 2023

Another week, yet more cases of global tax evasion and tax fraud. But more importantly, yet more evidence (as if it were needed) that tax authorities are doubling up efforts to clamp down on perpetrators of financial wrongdoing. And as we’ll discover in our round-up of some of the top news from across the globe, countries are investing in their capabilities to ensure that they can collect the right amount of taxation income from organisations (and individuals). For recruitment agencies placing contractors abroad, the need to remain tax compliant must always remain a top priority.

For our first story, we go to the Hellenic Republic of Greece where the government and tax department are bolstering the digital infrastructure of their tax operations centre. Soon to employ 100 people, the facility will enable tax officials to conduct immediate tax inspections with real-time tax statistics and records on company’s business activities being provided to 300 tax inspectors. “We are adding another weapon to our arsenal so that we can achieve even more immediate results,” said Giorgos Pitsilis, who heads up the country’s Independent Public Revenue Authority (AADE).

Both Finance Minister Kostis Hatzidakis and Deputy Finance Minister Harry Theoharis visited the centre. In an interview with Skai TV, the latter recently revealed that the extent and economic cost of tax evasion in Greece was estimated to be in the region of $8-10bn, half of which he said could be recovered. The new raft of measures outlined by the government follows the expiry of the July deadline date allowing state debtors to sign up to a generous repayment scheme, for which the take-up was low. The message is clear: tax evasion and non-compliance will not be tolerated.

Our next news item concerns one of the most powerful economies in the world and the affairs of one of its biggest companies with another major trading partner. The Warren Buffett-backed Chinese auto manufacturing giant BYD is in hot water with authorities in India for allegedly underpaying taxes on imported parts. Although the company has settled the amounts owing ($9m) following the findings of the country’s Directorate of Revenue Intelligence (DRI), investigations are still continuing with the global giant potentially having to fork out more in fines and penalties.

The company’s plans to invest $1bn into its car-making capacity have also come under the watchful eye of authorities given tighter regulations on foreign investment from neighbouring countries. Recent border clashes haven’t helped relations between the two countries. But the tax problems for BYD don’t end there, the car giant also allegedly not meeting the conditions to benefit from the tax breaks on imported parts for its electric vehicles. This would mean paying as high as 70% or 100% instead of 15% or 35% on imported car parts (which must however be assembled locally to qualify).

The impact of tax evasion on public services

Neighbouring Bangladesh has also come under the spotlight in a recent report published by the London-based Tax Justice Network (TJN). The advocacy group’s ‘State of Tax Justice 2023’ report found that both domestic and offshore tax evasion in the country has worryingly increased by a huge 168% in recent years, with an attributed value of $243m. Indeed, they estimate that corporate tax evasion by global multinationals has resulted in lost tax revenues of $361.2m with individual offshore tax evasion at $26.1m. Staggering numbers that reflect inherent tax management flaws.

As the report highlights, these tax losses clearly have wide-reaching consequences on Bangladesh’s finances and in particular the hit to its public services. Spending on health could have increased by 30%, which for a country so badly affected by COVID and dengue fever outbreaks, would make a significant difference to its people’s wellbeing. The findings reveal that the education sector, also impacted by the pandemic, would also benefit from a 6% rise. The National Board of Revenue and the Bangladesh Bank tax controls are clearly not robust enough in preventing tax fraud of this scale.


As we’ve seen in the examples above, tax authorities around the world continue to take the fight to companies who cheat the tax system and deprive their countries of much-needed tax revenues. Recruitment agencies placing contractors abroad must tread carefully to ensure they don’t get caught up in tax evasion, as the penalties can be very severe. For all tax compliance and related contractor management advice across 70+ countries, you can contact our expert 6CATSPRO teams.

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