Tax battle in Tyrol: construction company evades 556,000 euros!

Tax battle in Tyrol: construction company evades 556,000 euros!

Investigators have discovered massive irregularities at a Tyrolean construction company that led to tax fraud totaling 556,000 euros between 2020 and 2023. This sum includes both unpaid wage-related taxes and money spent through fictitious companies. An audit team from the payroll tax audit service found around 65,000 hours of work for which no corresponding taxes were paid. These involved significant discrepancies in the working time records, which in turn resulted in undeclared wage payments amounting to around 344,000 euros.

The investigation also uncovered a network of bogus companies that issued fake invoices for construction services provided. Through these practices, taxes amounting to around 212,000 euros were avoided. The main defendant in a trial relating to this case was sentenced to a suspended prison sentence of 12 months and a fine of 80,000 euros, while his stepson was given a 3-month suspended prison sentence and a fine of 70,000 euros.

Investigations and legal consequences

The uncovering of the machinations is the result of extensive cooperation between the Ministry of Finance, the tax office and the audit service for payroll taxes and contributions. In this context, Finance Minister Markus Marterbauer condemned the damage to honest taxpayers caused by such fraudulent practices and announced that he would intensify the fight against tax fraud.

The social benefit fraud task force has already recorded significant successes, including solving an AMS fraud in Tyrol. Such actions are not only intended to act as a deterrent, but also to strengthen citizens' trust in the fairness of tax collection.

Sham companies and the impact on the market

Sham companies are a recurring problem that goes beyond the cases described above. These companies issue fictitious invoices that are often paid through conduit companies. After payment, the companies withdraw the money in cash and pay it to the service providers. Such methods promote undeclared or partial undeclared wages and distort competition in the construction and service sectors.

The future Anti-Fraud Act 2024 Part I plans to introduce a new criminal offense in Section 51b FinStrG. This law is intended to close a gap in sanctions and, in particular, to penalize the use of false or inaccurate evidence. Anyone who produces or uses forged documents to conceal business transactions will face fines of up to 100,000 euros. These measures are essential to effectively hold fake entrepreneurs accountable and protect the integrity of the market.

The statute of limitations for these financial offenses is now three years, which makes it easier to prosecute such offenses in a timely manner. By moving the matter forward to the preparatory stage, the investigative authorities should be able to take action against bogus companies more quickly and effectively.

The recent revelations in Tyrol are a clear warning shot and make clear the importance of resolutely combating such fraud structures. [5min.at]. There is an urgent need to restore trust in legal and fair business practices.