Draconian tax law slammed in Tallinn

A Tallinn attorney said the government had gone too far with a new law that threatens imprisonment of up to 10 years for businessmen who fail to submit a tax return on time, calling it anti-business.

Writing in the Aripaev daily, lawyer Leon Gilkman said such severe penalties showed that the government regarded businssmen as enemies rather than friends.

The new penal code seems to indicate that the main purpose in the life of people, especially businessmen, is to serve the state and civil servants, Gilkman wrote. Should businessmen fail to fulfil their key function, the state is there to punish them with the full severity of the law.

The punishment for obstructing the activities of a tax administrator, including failure to submit a tax report on time, is punishable by up to 10 years in prison if it leads to a tax loss of at least 500,000 kroons. (32,000 euros).

However, if the person has been convicted previously for a similar offense, the 500,000 kroon limitation no longer applies and the person can be imprisoned for up to 10 years for smaller tax offenses.

Also the punishment for repeated violation of accounting regulations carries a 10-year maximum imprisonment penalty.

Glikman writes that although the court may never have to apply the maximum penalty, the issue is whether creating a possibility to penalize businessmen at such a degree is reasonable.

Tax offences carry heavier penalties than theft, poisoning, arson, bribery, torture, drunk driving and manslaughter, according to the new penal code.

Penalties for causing insolvency or money laundering are much tougher than the penalty for abuse of office, filing an inaccurate claim or bribery.