Utility bills to count toward tax discount

The payment of utility bills using credit or debit cards will also count toward the tax discount for electronic transactions, according to sources, as the state appears unable to distinguish such payments from spending on goods and other services.

Although the Finance Ministry originally wanted to exclude the payment of water, electricity and telephone bills from the amount that taxpayers must spend by electronic means to qualify for a tax discount of 1,900-2,100 euros from their annual income, it now appears that almost all expenditure using cards will count.

In a statement issued last week, the ministry cited “rent payments and utility bills, as well as those for landline, cell phone and pay-TV services” as examples of exemptions from the measure. However, the problems identified by various state agencies have forced the ministry to accept almost all transactions that taxpayers will make this year toward their tax discount.

This means that the vast majority of taxpayers will be able to clear the minimum amount with great ease – far greater than in the past – as receipts from supermarkets and utility bills will suffice.

Salary workers, pensioners and farmers must spend between 10 and 20 percent of their annual income for 2017 (up to a maximum amount of 30,000 euros) using cards or other electronic means. Incomes of up to 10,000 euros per year require that 10 percent be spent via electronic transactions, those up to 30,000 euros require 15 percent and those over 30,001 euros require 20 percent.

Although this is mid-January already, the ministry has still not issued its decision on the exact spending types to be excluded, so taxpayers are still guessing, while the market is fairly upset in anticipation of another decision determining which enterprises will be forced to operate card terminals. Ministry officials say that the government is considering the introduction of several exceptions to this obligation, mainly concerning smaller enterprises in retail commerce, even though this is a known source of tax evasion.