Compliance with filing of taxes must improve

ORANJESTAD – Tax Department is a government department with the task of guaranteeing tax revenue and facilitating the taxpayers to comply with their fiscal duty.

Building DIMPFiscal responsibility entails the timely filing of tax returns and their timely payment.

Compliance with tax declarations is an essential part of the fiscal behavior of contributors. During the past years, compliance fluctuated just under 80%.

The Tax Department emphasizes that compliance with the tax returns for income tax and profit tax should improve.

It is worrying to see a gradual decline in income tax compliance, which is of great concern to the tax authorities. Compliance with the monthly declarations is going in the right direction and could be even better.

The graph below shows an overview of compliance with tax returns.

Compliance for monthly tax declarations
2016 2017 2018 2019 2020 2021 2022
Payroll tax 70% 74% 67% 75% 71% 75% 78%
BBO 66% 68% 63% 69% 66% 69% 69%
Tourist tax 67% 64% 61% 70% 79% 85% 86%
Special tax stay 69% 67% 66% 73% 79% 85% 86%
Playing license law 100% 100% 100% 100% 89% 91% 87%
*up to July 2022
Compliance for filing income tax return and profit tax
2015 2016 2017 2018 2019 2020 2021
Income tax 79% 74% 74% 72% 72% 67% -
Profit tax 67% 68%  65%  62% 57% 56% 60%

Failing to comply with the filing of taxes (tax declarations) will result in the tax inspector imposing a tax assessment based on a calculation which will also include a penalty for non-compliance. It means that the Tax Office will charge the client more taxes which can result in financial trouble.

Working on improving compliance

The Tax Department continuously improves compliance to reach 80% or 90%. It will not only continue to point out the obligations and rights to taxpayers but will also act if taxpayers ignore its notifications.

Creating awareness of tax compliance is an essential part of the communication plan of the Tax Department but is also the responsibility of accountancy firms, tax lawyers, and taxpayer representatives that must point out to taxpayers that they must be aware of this responsibility. Not filing tax returns and not paying taxes is not an option and is punishable by law. 

The Tax Department is more transparent about the degree of compliance, warns those who fail to meet their tax obligations, and at the same time thanks those who meet all their tax obligations. This last group has shown their awareness and the importance of tax compliance.

Complying with taxes is complying with your country.

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