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ISSN 1684-9833 • Year 5 / No. 17 /October 4, 2013
The Executive Secretariat Informs The Executive Secretariat Informs CIAT Technical Conference 2013 Nairobi, Kenya CIAT Executive Council meeting in Nairobi
CIAT Technical Conference 2013 - Nairobi, Kenya The 2013 CIAT Technical Conference took place this September 9 to 12, under the auspices of the Kenya Revenue Authority, on the topic: “Prevention and control of tax evasion.”
Seminar on “Regional Integration and Cooperation in the Tax Administration”, Nairobi, Kenya, September 13, 2013
The technical sessions were held in the United Nations Building in Nairobi.
ITC- GIZ –CIAT Study on “General Aspects of the inflation effects on transfer pricing adjustments processes.”
The Conference was attended by a total of 50 delegations: 23 CIAT member countries, 14 invited countries, and 13 international organizations and institutions related to the CIAT.
Suriname: Design of the new computer system for the internal taxes management NATI/CIAT Service: support to identify competent authorities of DTCs and TIEAs Results of the Sixth Edition of the CIAT AEAT - IEF Research Scholarship The Tax Administrations Inform Argentina - Aruba Signed a tax information exchange agreement Argentina – Collection in September, 2013 Canada - Strengthens Economic Cooperation With Asia-Pacific Partners Colombia - New penalty system will deter Customs fraud Costa Rica - Ministry of Finance offers a new website Costa Rica – Tax Culture will be part of elementary social studies and civic education programs. France - Activity Report of the General Directorate of Public Finances. DGFiP Report 2012 Honduras - Exporting in one day is now possible by the interconnection of exports and customs systems Jamaica - TAJ Increases court action for outstanding property Taxes Panama - United States begin formal negotiations for the implementation of FATCA IBFD News Events Post of the Month Other Documents of interest
Virtual presentations in the CIAT 2013 Technical Conference
CIAT Executive Council meeting in Nairobi On Sunday September 8, the day prior to the start of the CIAT Technical Conference, the Executive Council met in Nairobi, Kenya. This meeting mainly addressed the reports of activities and the budgetary execution of the current period as well as the audited financial statements of the previous period which ended on June 30 of this year. Argentina chaired the meeting which was attended by the representatives of Brazil, Canada, Chile, El Salvador, Netherlands and Uruguay. The Heads of the permanent missions of Spain, France and Italy at the CIAT were invited to this session.
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Seminar on “Regional Integration and Cooperation in the Tax Administration”, Nairobi, Kenya, September 13, 2013 In recent years, CIAT has been organizing an additional activity upon the conclusion of its General Assemblies and Technical Conferences. This year, following the Technical Conference held in Nairobi, Kenya, a CIAT Seminar on “Regional Integration and Cooperation in the Tax Administration” was held on September 13, 2013, with the co-sponsorship of the World Bank – IFC, International Tax Compact – ITC and the African Tax Administration Forum – ATAF.
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Present in this event were delegates from the tax authorities of Africa, America, Asia and Europe, as well as representatives of regional organizations. The participating CIAT member countries were: Barbados, Bolivia, Canada, Chile, Costa Rica, El Salvador, Guatemala, Guyana, Nicaragua, India, Peru, Sint Martin, Spain, Trinidad & Tobago and Uruguay.
CIAT is a public international organization which groups the tax administrations of 39 countries, (31 Amarican countries, 5 European countries, 2 African countries and 1 Asian country), for the purpose of providing an integral service for the modernization of those administrations, by promoting their evolution, social acceptance and consolidation through the exchange of knowledge, experiences and the rendering of specialized technical assistance.
The participants discussed the importance of regional integration of the tax administrations, as well as the challenges and opportunities of intra-regional and South-South cooperation.
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From left to right: Mr. Socorro Velázquez, CIAT Director of Planning and Institutional Development; Mr. Márcio Ferreira Verdi, CIAT Executive Secretary; Mr. Rajul Awasthi, World Bank; Ms.Heidi Wagner, International Tax Compact.
Contact us: CIAT Executive Secretariat / e-CIAT Newsletter P.O. Box 0834-02129 Panama, Republic of Panama. Phone (507) 265-2766 / 265-5994 Fax: (507) 264-4926 E mail:ciat@ciat.org Web Site: http://www.ciat.org
CIAT Seminar on “Regional Integration and Cooperation in the Tax Administration”.
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ITC- GIZ –CIAT Study on “General Aspects of the inflation effects on transfer pricing adjustments processes.” Sponsor: ITC-GIZ; Author: CIAT September 2013 As a result of the collaboration among the “International Tax Compact “ initiative, Germany’s GIZ and CIAT, it has been possible to conclude an unprecedented work for the international tax community, regarding the main effects of inflation on the processes of setting and adjustment of transfer prices. This work has been coordinated by CIAT’s Cooperation and International Cooperation Directorate, with experts from different countries in the region and the tax administrations from Chile, Spain, Mexico, Peru, Dominican Republic, Uruguay and South Africa, that provided information on legal and procedural aspects. The objective of this exploratory work is to analyze if the most widely accepted methodologies in the world to determine if transfer prices are set among related parties according to market values, are appropriate when the company examined is located in a country that faces an inflationary economy. Throughout the present study, several questions are discussed, among which are: Is inflation a factor to take into account in the comparability analysis? , If such is the case, can the inflationary effects be corrected by comparability adjustments? Does inflation have the same influence in all methodologies? Can we talk about acceptable inflation levels within the methodologies? Can we assume that above certain inflation levels (i.e. in the case of hyperinflation) the methodologies don’t suit the situation? Once again we thank the “International Tax Compact “ for promoting multilateral cooperation, that allows the possibility of providing products and services to our tax administrations and to the international tax community in general.
Suriname: Design of the new computer system for the internal taxes management The CIAT Executive Secretariat conducted a technical mission to the Tax and Customs Directorate of Suriname to collect information for designing the Terms of Reference to the construction and implementation of a new internal taxes management integrated system. Based on this document, the Director of Revenue and Customs, Mr. Cornelis A. Van Dijk, and the Ministry of Finance of Suriname will present the project to the InterAmerican Development Bank – IDB, for financing. Raul Zambrano, Director of Technical Assistance and Information Technology, and Francisco Beiner, Director of Operations and Institutional Management conducted this mission on September 24 to 27.
Raúl Zambrano y Francisco Beiner with Cornelis A. Van Dijk, Director of Taxes and Customs; Joan Veldhuizen, Chief-Inspector of Direct Taxes; and Carlos Wong, Chief-Collector of Direct Taxes.
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NATI/CIAT Service: support to identify competent authorities of DTCs and TIEAs Approximately two years ago, CIAT launched the Consultation System of Competent Authorities NATI “National Authorities for Tax Information”, through which consults on contact information related to competent authorities for the negotiation and/or application of agreements for the exchange of information and treaties to avoid double taxation can be made. To date, we have successfully treated more than 30 consults from our member countries. The system has been specially designed to provide precise and 100% up to date information. The system is not a database, since we considered that option could suffer from a lack of frequent updates. Through NATI, each consult activates an internal process that allows the validation of the available information and access to new information, before presenting an answer. The average response time is 3 to 15 days. We invite all the employees from CIAT’s member countries, interested in contacting competent authorities, to ask their respective Correspondents in their tax administrations, to continue using the system to make consults, since only CIAT’s Representatives and Correspondents are allowed to operate it.
Results of the Sixth Edition of the CIAT - AEAT - IEF Research Scholarship In relation to the sixth edition of the CIAT-AEAT-IEF research scholarship, the Executive Secretariat informs that the prize has been declared withdrawn. According to the last paragraph of XI rule of the Bases (approved by the June 11, 2013 Resolution), the call for these awards could be rescinded when the proposals submitted by the candidates had been valued with scores less than 20 points. Having the jury rated all the papers submitted with less than 20 points, the award has been declared withdrawn. In the near future, this decision will be published in the official Bulletin of the State Kingdom of Spain and follow-up actions will be announced.
The Tax Administrations Inform
Aruba - Argentina signed a tax information exchange agreement The Convention reaches all taxes imposed or managed by Aruba, while in the case of the Republic of Argentina, it includes the profit tax, value added tax, personal property tax and tax on minimum presumed income. Argentina, through the AFIP, signed an agreement for the exchange of tax information with the Kingdom of the Netherlands with regard to Aruba. The document was sealed by the Federal administrator of public revenues, Ricardo Echegaray and the Chargé d’affaires of the Embassy of the Netherlands, Joris Jurriens. Jurriens stressed that the signed agreement with our country is key to fight tax fraud. “Aruba guarantees a stable legal system which seeks to become the bridge between Latin America and Europe,” emphasized the Chargé d’affaires of the Embassy of the Netherlands. Carlos Alberto Sánchez Correspondent
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Argentina – Collection in September The Secretary of the Treasury Juan Carlos Pezoa and the Federal administrator of public revenues, Ricardo Echegaray, detailed the tax collection in September. Carlos Alberto Sánchez Correspondent
Canada Strengthens Economic Cooperation With Asia-Pacific Partners Canada is a world leader in the creation of efficient public-private partnerships for building public infrastructure. The Honourable Kevin Sorenson, Minister of State (Finance), met with finance ministers from the Asia-Pacific Economic Cooperation (APEC) in Bali, Indonesia, to promote global economic growth and to build bilateral relationships with this fast-growing region of the world. He also promoted Canada’s positive record of creating jobs and growth amid a still-fragile global recovery. “Canada’s economy continues to perform relatively well, but we are not immune to global events. Beyond our own borders, Canada continues to play an active role in strengthening the global economy and making it more stable than when the global economic crisis first emerged,” said Minister Sorenson. Maria Pica Correspondent
Colombia - New penalty system will deter Customs fraud EThe Project of the New Customs Statute, which final draft is reviewed by the Ministries of Commerce, Industry and Tourism and Finance, will be a deterrent to use international trade as a tool for crime, with a more rigorous sanctions regime. The new regime seeks to punish customs offense for their real impact: lower fines for lower offenses, greater severity for serious breaches, and drastic measures for the criminal ones.
Costa Rica - Ministry of Finance offers a new website Easily accessible services, better available information, compatible with all browsers and mobile devices are some of the benefits of the Ministry of Finance New Website The Ministry of Finance makes available to users a new website, easy to navigate and accessible to mobile devices, with a new organization of information for services and a completely renewed graphical presentation. From the homepage, connected users can complete their procedures for filing returns and paying their taxes; easily obtain information on income, expenditure and debt, as well as access to services provided by the institution, distributed by areas of competence. The home page also displays the contacts for complaints and answers to frequently asked questions about tax, customs and public procurement. Maribel Zúñiga Correspondent
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Costa Rica – Tax Culture will be part of elementary social studies and civic education programs Tax Culture will be included by the Ministry of Public Education (MEP) in sixth grade Social Studies and Civic Education classes, from the academic year 2015. This inclusion is part of the modification to the curriculum conducted by the MEP and is a result of the support by the Higher Education Council to the efforts made by the Ministry of Finance, through the Directorate of Information and Taxpayer Customer Service. Maribel Zúñiga Correspondent
France- Activity Report of the General Directorate of public Finances. DGFiP Report 2012 The topic of this activity report on last year’s actions is usual but essential for the General Directorate of Public Finances (DGFiP). It represents for all administrations the opportunity to offer our citizens accountability for our action and the fulfillment of our missions. In relation to the DGFiP, this report will show theses mission’s variety and importance, such as Tax management and Control, State Public Administration and local Public Sector Management. It will also allow observing the quality of the work accomplished, measuring our results for each service provided.
Honduras - Exporting in one day is now possible by the interconnection of exports and customs systems The interconnection provides the best security and transparency; the information is reflected in real-time, so Honduran exporters may introduce the required information in a single procedure The International Finance Corporation (IFC), the institution of the World Bank Group for the Private Sector and Government of Honduras Development launched a new system that reduces time and cost to obtain export permits. The International Financial Corporation (IFC) is helping to make life easier for Honduran exporters to promote the country’s integration into regional and global markets. Grace de La Paz Saravia Correspondent
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Jamaica - TAJ Increases Court Action For Outstanding Property Taxes Tax Administration Jamaica (TAJ) is increasing court action against property owners who have not paid their property tax for several years, despite receiving notices. The compliance activity will be concentrated in specific parishes each month and will continue through to the end of the fiscal year. Meris Haughton Correspondent
Panama - United States begin formal negotiations for the implementation of FATCA Formal opening of the first round of negotiations aimed at reaching an intergovernmental agreement for implementing the Foreign Account Tax Compliance Act (FATCA) in Panama. As a result of the meeting held in Washington DC between representatives of the Ministry of Economy and Finance (MEF) of Panama and the United States Treasury Department, the first round of negotiations aimed at reaching an intergovernmental agreement (IGA) for implementing in Panama the Foreign Account Tax Compliance Act (FATCA) has officially started. This meeting was held within the International Taxation Seminar framework, addressed to Finances and Deputy Ministers and Tax Administrations Directors; it was organized by the Inter-American Development Bank (IDB) and the Inter-American Center of Tax Administrations (CIAT), during the week of August 26.
IBFD News International Bureau of Fiscal Documentation (IBFD) Cooperation- CIAT - IBFD
This section includes a selection of the IBFD news about aspects of tax policies and tax administration. This information is available on the CIAT website and in Fridays Tax News alert.
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Events 4th WCO Technology & Innovation Forum Buenos Aires, Argentina 12-14 November, 2013
The World Customs Organization (WCO) and the Federal Administration of Public Revenues (Administración Federal de Ingresos Públicos - AFIP) of Argentina are delighted to announce that the 2013 WCO Technology & Innovation Forum will take place in Buenos Aires, Argentina from 11 to 15 November 2013. An innovative agenda structure will offer different possibilities to engage in extensive expert debates, review the best practices and offer peer-to-peer learning as well partnership opportunities for industry. These methods have been expanded and further developed based on feedback received from the previous Forums
Post of the Month 27 September, 2013
Financial education for the G-20 Written by: María Goenaga Ruiz de Zuazu EI have recently relayed, through the Financial Education Network of Spain (coordinated and funded by the Spanish Confederation of Savings Banks, in Spanish CECA) that the OECD, through its report “National Strategies for Financial Education “, proposes to introduce this topic to all the citizens of the G-20 (the 20 wealthiest countries in the world). The report shows that financial education level is low among European consumers, and in the current economic crisis, it is a weakness that the OECD believes should not be allowed
Other Documents of interest Las Administraciones Tributarias de Centroamérica, Panamá y República Dominicana. Información y Reflexiones
“Tax Administrations of Central America, Panama and the Dominican Republic. Information and Considerations” Oscar Vásquez and Fernando Díaz Yubero CAPTAC-DR May, 2013 This publication has been based on the information collected by both the survey prepared by the IDB, CAPTAC-DR and CIAT for Latin American administrations (2006-2010) as per the various assistance missions carried out by this Technical Assistance Center.
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Study to Quantify and Analyse the VAT Gap in the EU-27 Member States European Commission 2013
This report presents and discusses the findings of the “Study to quantify and analyse the VAT Gap in the EU-27 Member States�. According to the Terms of Reference, the aim of the study is to help better understand the recent trends in the field of VAT fraud, by updating the VAT Gap estimates for 2000-2006.
World Economic Outlook (WEO) Transitions and Tensions International Monetary Fund October, 2013
Explores how output comovements have evolved in recent years and how they are influenced by various shocks and linkages. It assesses the possible output spillovers from those shocks that most concern policymakers, including policy shocks, such as unexpected monetary or fiscal tightening; financial shocks, such as a systemic banking crisis or renewed financial turmoil.