Tax dodgers inclined to flash and fanfare may have to scaleback their spending on luxuries if they expect to continue to evade the tax net.

Government is now able to tie assets and lifestyle to taxes paid, or perhaps more importantly what wasn’t.

The Tax Administration Services Department’s (TASD’s) Forensic Data Mining Intelligence Unit (FDIU), implemented at the beginning of the 2009/10 fiscal year, has been unearthing tax dodgers by cross referencing various databases of individuals and building profiles to assess a person’s true income bracket as opposed to what is being reported — or not being reported at all.

“What we look at are different databases to build a profile and from that we determine whether or not an income reported by an invidual or a company seems factual when you look at a person’s net worth or lifestyle,” said TASD communications director Meris Haughton.

Millions of dollars have now been recovered over the past year because of a new intelligence unit targeting high risk groups, said Haughton adding that tougher measures would be taken on deliquent taxpayers.

“Where warranted, we will be making criminal charges against delinquent taxpayers, particularly in cases where money is collected and not paid over, example PAYE (pay as you earn) and GCT (general consumption tax),” Haughton said.

However, in a release to the media last week, the TASD reported that 50 “high-profile” persons, among them businessmen and entertainers, were identified as delinquent taxpayers and stop orders were issued preventing them from leaving the island.

The FDIU automatically generates a “failure to file” notice for entities which have not filed their taxes up to the deadline, March 15 this year.

Haughton said such notices have been mailed to over 56,000 delinquents, including 44,786 self employed persons and 11,242 organisations.

The notices allow 14 days within which to respond after which the outstanding payments are subject to 40 per cent interest per annum, calculated daily. Payments which are still outstanding after the notices are served will generate an estimated assessment which, under the Income Tax Act is subject to a 300 per cent penalty. There is also the possibility of court action which includes a fine of $10,000 or one year imprisonment, in addition to the payment of the outstanding sum.

Since this year, 3184 businesses have been brought before the court for tax matters valued at $8.9 billion.

Haughton says consistent with the measures used elsewhere there will be additional measures taken in the 2010-2011 fiscal year to ensure that the taxes are collected.