Austria’s government has reached agreement on an expansive new package aimed at cracking down on tax fraud, a move leaders say is essential as the country works to stabilize its budget, according to Austrian News Agency APA. Vice Chancellor Andreas Babler announced the plan Tuesday following a cabinet meeting, projecting that the measures will bring in 270 million euros next year and a total of 1.4 billion euros by 2029.
The initiative targets a wide range of abuses from loopholes used in luxury real estate deals to shell companies, construction-sector liabilities, and social-insurance fraud. “In times of budget consolidation, there can be zero tolerance for companies that cheat the public,” Babler said. Foreign Minister and NEOS leader Beate Meinl-Reisinger echoed the sentiment, calling it a matter of basic fairness.
Finance Minister Markus Marterbauer noted that tax fraud takes many forms: manipulated cash registers, fake firms, cross-border carousel schemes, and loopholes exploited largely by the wealthy. Confronting these practices, he said, is essential “not only for stabilizing the budget, but for safeguarding justice and a functioning economy.”
One of the most consequential steps is aimed at shutting down tax strategies associated with Signa founder René Benko. The government plans to eliminate the ability to deduct VAT on luxury property rentals, a change expected to generate roughly 50 million euros annually. Officials also proposed reforms to insolvency rules to prevent taxes and social-insurance payments already made from being reclaimed into bankruptcy estates. Only cases lacking sufficient funds to open bankruptcy proceedings would be exempt.
The package goes further: Austria plans to abolish tax refunds tied to exporting used or wrecked vehicles abroad, expand information-sharing requirements in social-insurance investigations, and strengthen penalties against sham self-employment. In construction, contractor liability related to temporary labor will rise from 25% to 40% of a project’s total value.
Deliberate tax evasion will face tougher penalties, even when offenders report losses. The government also intends to improve information exchange on crypto-asset taxation and limit cash payments at tax offices to 10,000 euros.
The measures stem from recommendations by an expert commission convened by the Finance Ministry. The cabinet is expected to approve the package this week, with lawmakers set to vote on it in December.
