Restaurants under threat from fiscal clampdown

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The Belgian government’s tax raising fiscal clampdown includes restaurants and pubs who will be obliged to declare all sales through a new design of cash register. Without that element of undeclared income or ‘black’, many pub and restaurant owners fear they will be forced out of business.

The organisation representing the hospitality industry in Belgium, Horeca Vlaanderen, admits that restaurant and pub owners are forced not to declare at least a part of their income to the taxman. “It’s the only way to make a profit.”

Horeca Vlaanderen also admitted that Euro Tap Control (ETC), the biggest company for cash register systems in Belgium, regularly gave dozens of restaurant and café owners tips about how to commit fraud. Some 30 employees of ETC made confessions as they were questioned by police.

When ETC supplied automatic cash register systems, they explained to restaurant and pub landlords how they could tamper with the software to be able to reduce turnover figures without leaving a trace. Most pubs and restaurants, it is suspected, fail to declare some 20 percent of their turnover to the Belgian state.

A spokesman for Horeca Vlaanderen said that “we are not proud of this, but it’s a daily practice which is necessary for restaurants and pubs to make a profit, in a country where labour costs are so high.”

As from 1 January 2014, a so-called black box should be installed which should make it impossible to commit any kind of fraud. Horeca Vlaanderen is afraid that many pubs and restaurants will go bankrupt.