The Financial Police is a professional and efficient anti-fraud unit of the Ministry of Finance, which is independent in terms of human and financial resources. The central task of the Financial Police is to carry out targeted controls in order to detect tax evasion, social fraud and organised shadow economy, thereby protecting the financial interests of the Republic of Austria.
Tax fraud distorts competition and harms the economy and each individual who has to pay higher taxes as a result. The aim of combating fraud is to sustainably secure and strengthen Austria as a business location and create new jobs. Fiscal and social fraud jeopardises these projects, as honest entrepreneurs are massively disadvantaged.
The Federal Ministry of Finance is taking targeted measures to protect the domestic economy from this threat. Combating fraud means more justice, more equal opportunities and more protection for the domestic economy. The anti-fraud fight of the Federal Ministry of Finance is not about burdening the economy with increased controls, but about creating fair conditions for all participants in economic life.
The Anti-Fraud Act 2010 has significantly expanded the possibilities for combating fraud in the tax sector with § 12 of the Tax Administration Organisation Act (Abgabenverwaltungsorganisationsgesetz, AVOG) (Financial Police). With the standardisation of the powers of the Financial Police (right to enter and retain, right to determine identity), the legislator intended to visibly strengthen the preventive effect of tax supervision and other control measures.
Many of the powers that had been granted before primarily in the regulatory area (formerly KIAB – control of illegal employment of workers, Kontrolle der illegalen Arbeitnehmerbeschäftigung) or in the customs sector to the bodies of the tax authorities are now available also for the prevention, detection and prosecution of tax evasion.
Tasks of the Financial Police
The task of the Financial Police is to ensure fair and equal conditions for all participants in economic life by means of controls and thus to protect the financial interests of the Republic of Austria. In the interest of the labour market and Austria as a business location, the preventive work of the Financial Police is intended to prevent unfair competition resulting from competitive advantages through illicit work and social security and tax fraud. This also serves to safeguard the wage and working conditions of domestic and integrated foreign workers, especially with regard to the development of the Austrian labour market situation.
The primary tasks of the Financial Police activity essentially comprise tax supervision measures (supervisory and control activities for the purpose of tax collection) as well as regulatory measures (in particular labour market tasks and controls under the Social Fraud Act (Sozialbetrugsgesetz) and compliance with the Gambling Act (Glücksspielgesetz)). The purpose of bundling these measures in the Financial Police is to make the necessary actions more up-to-date and quicker, to detect and evaluate facts promptly, and to evaluate and pass on the knowledge gained in a targeted manner.
Since 01 July 2013, this nationwide organisational unit has been independent in terms of personnel and business and is based in Vienna with offices at the headquarters of each tax office.
The Data, Information and Analysis Centre (Daten-, Informations- und Analysecenter, DIAC), which is responsible for database research and analysis and for providing information to domestic and foreign authorities, is also integrated into the Financial Police.
The Financial Police, as a body of the tax authority, acts to carry out tax supervision, collection and tax security measures and regulatory tasks.
The establishment of the Financial Police as a nationwide anti-fraud unit is an essential contribution to the implementation of the strategy of the Federal Ministry of Finance to improve the anti-fraud fight in order to protect the financial interests of the Republic and Austria as a business location.
The management of the Financial Police is located at Hintere Zollamtsstraße 2b, A-1030 Vienna.
The fiscal supervision measures of the Financial Police include determination of the basis for tax collection, including the setting and collection of the tax.
The supervisory and control activities include in particular:
- Determination of fiscally relevant facts
- Prevention of non-declaration of sales and earnings, and failure to declare or pay wage taxes
- Detection of companies not registered for tax purposes or of companies without a permanent establishment in Austria
- Securing of tax bases (e.g. detection and recognition of risky companies and transactions, as well as communication of the risk classification)
Special topic: Standardised consumption tax (Normverbrauchsabgabe, NoVA)
The Financial Police has an essential task within the framework of tax supervision in detecting the illegal use of vehicles with foreign license plates in Austria as well as the misuse of (blue) test drive license plates and the associated tax evasion (standardised consumption tax, motor-related insurance tax, acquisition tax, customs duties).
For the selection of facts worthy of examination, the Financial Police have access to extensive databases. These result, among other things, from the management of parking spaces in conurbations, internal control material and such from other authorities, data from general importers, notifications, own official perceptions.
The regular monitoring activities include ongoing large-scale actions with overall diversions of traffic from main roads and motorways and the establishment of checkpoints at neuralgic traffic points. In addition, the Financial Police have suitable emergency vehicles with flashing blue lights in order to detect corresponding vehicles from flowing traffic. However, the control is not limited to mobile retentions and public transport. The users or drivers of suspicious vehicles can indeed be visited at their place of work or residence as well.
Securing of tax claims, collection of tax arrears
- Investigations for the purpose of recovery measures
- Determination of the basis and preparation of backup orders
- Execution of confiscation orders
- Identification of customers for the execution of attachment, garnishment and seizure in case of claims
- Carrying out collection activities and attachment of debtors’ liens
Regulatory measures (in particular labour market tasks and checks on compliance with the Gambling Act) include in particular
Detection of illegal employment of foreign nationals
- Control of and in companies, business premises, operating premises, foreign workplaces and recreation rooms as well as of the employees met there for the existence of permits under labour market, residence and establishment law.
- Control of the contracting authority/entity regarding the fulfilment of the reporting obligations with regard to the contracted companies
- Notification and safeguarding of party status in administrative criminal proceedings
Detection of violations of the provisions of the Employment Contract Law Amendment Act (Arbeitsvertragsrechts-Anpassungsgesetz, AVRAG)
- Checking of and in companies, permanent establishments and foreign workplaces as well as the workers met there who have been posted from the EEA area for the existence of underpayment in accordance with the Anti-Wage and Social Dumping Act.
- Detection of violations of the regulations of the Austrian General Social Security Act (Allgemeines Sozialversicherungsgesetz, ASVG)
- Checking of and in companies, business premises and external workplaces to verify the correct registration of all employees before they start work and to check for incorrect and fraudulent registrations
Detection of violations of the registration requirements of the Unemployment Insurance Act (Arbeitslosenversicherungsgesetz, AlVG)
- Inspection of and in companies, business premises and foreign workplaces as well as the employees met there for compliance with the reporting obligations imposed on them under the AlVG.
Detection of illegal trade practice according to the Trade Regulation (Gewerbeordnung, GewO)
- Control of activities for the existence of an appropriate trade licence.
Detection of social fraud under the Penal Code of Austria (Strafgesetzbuch, StGB)
- Establishing facts concerning the withholding of employee social security contributions, fraudulent withholding of social security contributions and surcharges under the Construction Workers’ Leave and Severance Pay Act, and organised illicit work.
- Own investigations, or investigations on behalf of the law enforcement authorities
Detection of infringements in connection with national and international secondment of workers
- Inspection of and in companies, business premises and foreign workplaces as well as the employees met there who have been seconded by domestic and foreign companies.
Detection of violations of the Austrian Act on Secondment of Workers (Arbeitskräfteüberlassungsgesetz, AÜG)
- Inspection of and in companies, establishments and external workplaces to check the correct registration of the seconded workers and the remuneration to which they are entitled
- Detection of sham secondments
- Detection of violations of the Gambling Act
- Inspections of business premises and operating facilities as well as premises and the recording and retention obligations in accordance with the provisions of the Austrian Gambling Act (Glücksspielgesetz, GSpG)
- Provisional seizure of illegal gambling machines, other objects of intervention and technical aids
- Notification and safeguarding of party status in administrative criminal proceedings
The Financial Police can be tasked by the tax offices as the tax authority or first-instance fiscal penal authority to carry out general supervisory measures such as controls and inspections in accordance with § 114 of the BAO (Federal Fiscal Code, Bundesabgabenordnung) for pending tax procedures or general control, inspection and supervisory measures in accordance with § 99 II of the FinStrG (Financial Criminal Procedure Act, Finanzstrafgesetz) to obtain information and relevant data for financial criminal proceedings. In case of clear and present danger, the bodies of the Financial Police are entitled to take measures under the FinStrG, in particular § 89 II of the FinStrG (seizure in case of imminent danger) and § 93 IV FinStrG (house search in case of imminent danger).
By order of the criminal prosecution authorities, organs of the Financial Police can also be called upon to carry out investigations on suspicion according to § 153c of the Austrian Criminal Code (Strafgesetzbuch, StGB) (withholding of employee contributions to social security), § 153d of the StGB (fraudulent withholding of social security contributions and surcharges according to the Construction Workers’ Leave and Severance Pay Act) and § 153e of the StGB (organised illicit work).