Taxpayers in Kosovo are facing a serious problem: the disproportionate imposition of tax liens by the Tax Administration of Kosovo (TAK). In many cases, for an outstanding tax debt of EUR 100,000, TAK may impose a lien on property worth several times more, for example, EUR 5 million.
Such a measure fails to respect the principle of proportionality and infringes upon the fundamental rights of taxpayers. In most cases, the economic damage resulting from such measures is extremely high and, in certain circumstances, may even lead to bankruptcy.
The principle of proportionality, which is a key element of administrative law, is enshrined in Article 5 of Law No. 05/L-031 on General Administrative Procedure. This principle requires every administrative measure to be proportionate to its objective, meaning that the measure must be appropriate, necessary and balanced.
Furthermore, Article 31 of the Constitution of the Republic of Kosovo guarantees the right to a fair trial, while the principles of proportionality are embedded in the constitutional framework to protect individuals against excessive administrative actions.
Additionally, Article 55 of the Constitution provides that restrictions on fundamental rights and freedoms may be imposed only in accordance with the law and in compliance with the principle of proportionality. When property of substantial value is encumbered to secure a relatively small debt, this principle is violated, exposing taxpayers to significant financial risks.
Tax professionals should work together to ensure that measures undertaken by TAK are fair, lawful and proportionate to the outstanding tax debt. Respect for constitutional principles is essential to maintaining a fair taxation system.
This is not the only violation that TAK has committed over the years.
Have you or your client ever experienced such disproportionate measures? Contact us to discuss how we can put an end to this harmful practice.
