Tax Officials Block Company Account Due to Incorrect VAT Calculation

Here, unfortunately, is yet another story about the negligence of employees in the Tax Administration, causing entrepreneurs to lose time and credibility in the business world. Thus, a tax official threatened to block the account of one entrepreneur’s company and initiate enforcement, but fortunately, the tax officials realized they had made a mistake and canceled everything. However, not everything went as our entrepreneur would have liked.

Although the name of the entrepreneur and his company is known to the editorial staff, he did not want it to be published; the reason, I believe, does not need to be mentioned. His problem was primarily caused by the officer who handled his case in August and who calculated VAT from April instead of July, which amounted to thirty thousand kuna for his company at that time. This money was supposed to be paid into the state budget in May, but in that month, his company imported production machines. Due to the purchase of these machines, when calculating VAT, the state was supposed to refund him VAT of fifty-five thousand kuna. After he ‘offset’ that claim from the state with the April debt to it, it turned out that the state owed him twenty-five thousand kuna.

Acknowledged the Mistake

However, the officer who overlooked the state’s debt to the company did not think so, and the Tax Administration ordered Fina to block the entrepreneur’s company account with the threat of enforcement. As per the rule, Fina sent a warning to the entrepreneur (we have written in this column that enforcement could occur without prior warning) that the account would be blocked and enforced upon the first inflow of funds.

Having no idea what debt was being referred to, the entrepreneur rushed to Fina, and after learning that he owed VAT from April, he quickly went to the Tax Administration to explain that things were quite different. He stated that he had no complaints about the behavior of the employees in the Tax Administration; they were even very polite. When he presented the documents to them, they realized that their colleague had not been diligent and that the request for account blocking was unfounded. They firmly promised him that the problem would be resolved and that the state would fulfill its obligation to him. Satisfied that everything went so smoothly, he left the Tax Administration.

Three Days of Blocking

The satisfaction was short-lived because, despite acknowledging the mistake and promising to correct it, the tax officials were again not diligent. They did not timely inform Fina about the cancellation of the block, so the entrepreneur’s account was blocked one Friday. He called the Tax Administration, and when they realized that they had harmed the entrepreneur again due to their negligence, they tried to correct the mistake, but it was too late. The account was blocked for three days, until Monday, when a notice of cancellation urgently arrived at Fina.

Our entrepreneur was indeed angry, and rightly so. First, they did not calculate the VAT correctly, and then when they realized it, instead of making the resolution of his problem, which they had created themselves, a priority, they cheerfully sent him off with a smile and continued with their daily routine. Although we do not generalize, as there are surely those in the Tax Administration who diligently do their job, such negligence of employees in that institution is not unknown to the business public, which has alerted us to similar problems.

This means that these are not just incidents that the leaders of the Ministry of Finance and the Tax Administration can overlook, but they must address them. Therefore, we ask them to devote due attention to this problem.