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THE CYPRUS TAXMAN COMETH

Gambling 'godfathers' list prepared?
 
The Mediterranean island of Cyprus, long a desirable domicile for many online gambling companies, may see a substantial tax collection shake-up in the near future, according to the Cyprus Mail and other local media.
 
Georgios Poufos, the director of the government's Inland Revenue Department confirmed that his department was intensifying its tax inspection initiatives aimed at identifying defaulters and including them in the tax net, although he played down speculation that some 34 illegal gambling 'godfathers' were in his sights
 
Earlier this week the local publication Phileleftheros claimed that the IRD had identified some 500 people island-wide whose main income was from games of chance, most of whom do not have a tax-file with the IRD.
 
The 500 were said to include 34 people who are well-known to the police and between them control all illegal gambling, and were suspected of cheating on their tax obligations despite their companies making large profits from the pastime.
 
The article said that in conjunction with the police, the tax authorities were planning a clampdown in which the targets would be asked to clarify their sources of income.
 
Poufos told the Cyprus Mail that the IRD will invite “any legal or physical person resident for tax purposes in Cyprus who has not submitted a tax-return” to do so. “That is their obligation, so our role is to be a watchdog”, he added.
 
Anyone who fails to submit a tax-return when required is classified as delinquent, and therefore liable to penalties ranging from overdue interest to fines and criminal charges, depending on the specific details of each case..
 
“For some time now, we have intensified our inspections of the whole tax base, so it would be wrong to focus on just one small part in isolation”, Poufos said, adding: “We are bound by confidentiality on the details of our work.”
 
Another anonymous IRD source told the Mail: “There are a lot of people who handle millions – and not just to do with gambling – who do not have a tax file.”
 
House Legal Affairs chairman Ionas Nicolaou emphasised that parliament is discussing government proposals for regulating gambling – including online – which will clarify the scope of gambling revenues that could be taxed.



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