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Uli Hoeness – evasion or avoidance?

A hot political topic in Western countries since 2008 has been tax evasion; or more critically, the distinction between ‘avoidance’ and ‘evasion’.

This case has triggered great public interest and a heated debate in Germany on the issues of lenient treatment for public figures and whether confessions and subsequent settlement of unpaid taxes entitles tax evaders to immunity from jail.

In Germany, Bayern Munich F.C.'s President Uli Hoeness appeared before a Munich judge on Monday accused of tax evasion. According to the prosecution, the President has failed to:

1. declare his earnings in two Swiss bank accounts (a total of €33.5m (US$46.5m) worth of German income) used to fund dealings on global stock and currency markets;
2. meet a tax liability of €3.5m on those earnings between 2003 and 2009; and
3. accurately declare his losses up to €5.5m.

Hoeness has now admitted a tax liability closer to €18.5m. The Bayern President, elected to come forward when the German media discovered his account and threatened to take the story public; flouting the President's intention to admit guilt privately and quickly repay the tax due (plus a percentage interest and a fine). He consequently filed an amended tax return in January 2013 that publicly disclosed his financial affairs voluntarily.

Nonetheless, prosecutors argue that this was incomplete. If this proven and Hoeness found guilty he could face up to 14 years in jail. This trial comes at a time when, according to the Guardian, "German authorities have been aggressive with tax-evaders in recent years".

The club and its fans have backed their President, who offered to suspend his club duties pending a verdict.

Update 13 March 2013: Hoeness has been sentenced to jail for 3 and a half years for tax evasion - https://www.isportconnect.com/index.php?option=com_content&view=article&id=25743&catid=58&Itemid=167

Source articles:

https://www.bbc.co.uk/news/world-europe-26512968

https://www.theguardian.com/football/2014/mar/10/bayern-munich-uli-hoeness-tax-court

https://www.dw.de/tax-evasion-trial-of-bayern-munich-president-uli-hoeness-starts-with-a-bang/a-17486451