In an audit of tax control in the context of real estate leasing, the IGF concluded that “the Tax and Customs Authority does not have a comprehensive plan to control undeclared leasing, which includes, in particular, the information contained in complaints on this matter and in the Model 2 declaration of Municipal Property Tax (declaration of contracts for the supply of water, energy and telecommunications, communicated to that entity by the suppliers)”, according to the preliminary report published in the Report on Activities Carried Out to Combat Tax and Customs Fraud and Evasion, according to ECO.

The Secretary of State recalled that “the IGF detected that 60% of the leases it looked at were undeclared”. According to a report by the Secretary of State for Tax Affairs of the previous Government, for 2023, and published this year, on the fight against tax and customs fraud and evasion, “the results obtained in the samples collected” show that “60% of the lessee contractors did not have a registered/current lease agreement and 25% of the owner contractors, with supply contracts for various items/units, had no declared activity”.

To avoid this lack of control in the monitoring of illegal leases, the IGF recommended that the AT implement “an integrated action plan for the control of undeclared leases, which includes the use of various sources of information to identify and mitigate the risks of non-compliance/failure to declare income”, namely “information from the Model 2 declaration and the IMI”.

It was also suggested that “procedures be implemented to ensure greater quality and reliability of the information in the IMI Model 2” and that “an application be developed to centralise the management of reports” in order to “simplify/dematerialise the respective communication process and enhance its use as a source of information in the fight against tax evasion and the black economy”.

At the COFAP hearing, the Secretary of State revealed that the Tax Authority has already adopted “a good number of the IGF’s recommendations” to tighten controls on illegal leases, but did not specify which ones.