The potential effectiveness of tax compliance programs for the purpose of excluding liability for administrative tax offences

Abstract

The growing intricacy of economic relations and transactions is reflected by a parallel rise in the complexity of applying tax regulations. However, these circumstances do not appear to have been accompanied by a corresponding or equivalent adaptation in the sanctioning area, particularly with regard to the acceptable margin of error and the assessment of the taxpayer’s due diligence. Thus, tax compliance programmes, taking as a reference both comparative experiences and administrative practice developed in other sectors of the national legal system, may constitute a fully viable solution in this context. This conclusion is based primarily on the concept of the requisite diligence in fulfilling tax obligations, which is expressly recognised as a ground for excluding liability under Article 179(2)(d) of the General Tax Act (LGT), in cases involving the potential commission of tax infringements.