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ISSN 1684-9833 • Year 3/ No. 15 / August 17, 2012
The Executive Secretariat Informs The Executive Secretariat Informs Lieutenant Colonel Stefano Gesuelli: Head of the Italian Mission at CIAT CIAT visits the Trinidad and Tobago Tax Administration Technical Assistance to the Tax Administration in Suriname The international tax community assists the Central American and Caribbean countries in information exchange Technical Assistance Visit to the DEI of Honduras The Tax Administrations Inform Argentina - Historical Record: 61.317 million pesos Brazil - Electronic Invoices issued exceeded the barrier of five billion Brazil -Revenue and ABC sign a memorandum of cooperation with developing countries France - Report of DGFiP activities for the financial year 2011 Panama – current revenue grows B /. 400 million in July collected by the DGI Paraguay - GIZ starts cooperation with the SET Paraguay - IRP Training starts with good receptivity Peru - Authorized Economic Operator will enter in force in October Bolivarian Republic of Venezuela -The SENIAT celebrates the 18th anniversary of service to citizens and impetus to the economic development of Venezuela Dominican Republic - Directorate of Internal Taxes holds International Seminar on Experiences of Control Process in the Tax Administrations Dominican Republic - Juan Hernandez noted that it is essential to redesign the Dominican tax legislation
Lieutenant Colonel Stefano Gesuelli: Head of the Italian Mission at CIAT Since Monday, August 6, 2012, Lieutenant Colonel Stefano Gesuelli has joined CIAT as Head of the Italian Mission. Lieutenant Colonel Stefano Gesuelli has been head of the International Cooperation Department Office at the Intelligence Department of the General Directorate of the Guardia di Finanza. During his career he has been the head of several local offices in charge of, among other responsibilities, audits and financial and Teniente Coronel Stefano Gesuelli economic investigations. He has also been in charge of the General Chief of Staff of the Corps Office, has been assigned to various posts abroad and has worked at the Government’s Presidency as Director of the economic intelligence unit. He is an attorney and cum laude economist from the State University of Milan and “Sapienza” of Rome; he has degrees in international tax law from the LUISS University in Rome and in tax law from the “Vanoni “Superior School of Economics and Finance. In addition to these qualifications, he has participated in various courses and specialized programs in Italy and abroad. Stefano Gesuelli has been professor at universities and training institutes as well as speaker at various conferences and international courses, organized by tax administrations, international organizations, police and judicial authorities in the field of international tax cooperation, combating tax fraud and evasion, as well as organized crime and economic crime, among others. He is the author of numerous tax-related articles in Italian newspapers and magazines and contributes to the International Tax Review. He has been the National Representative of Italy in several active working groups and forums in the framework of international organizations (such as EU, OECD and IOTA) and he has participated as an expert in the activities of the Peer review Group of the Global Forum on Transparency and Exchange of Information on topics related to International Cooperation, fight against tax fraud and evasion, money laundering and tax crimes.
CIAT visits the Administration
Trinidad
and
Tobago
Tax
Thanks to the hospitality of Mrs. Deokie Hosein, Chairman of the “Board of Inland Revenue” of Trinidad and Tobago, an official mission to their offices was carried out by CIAT’s International Taxation and Cooperation Director, Mr. Gonzalo Arias to analyze and discuss the main legal issues related to the tax system, the legal framework that regulates the tax administration and its key processes.
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The visit was financed with funds from the Inter-American Development Bank (IDB) within the framework of the study entitled: “Status of the Tax Administrations”, which currently has relevant information on the tax administrations of the Latin American countries. Nevertheless, in order to provide a complete overview of the region, it is intended to be expanded to the Caribbean countries. Also, the ongoing collaboration given by Ms. Hosein and her team mainly formed by Mrs. Sandra Nimblett, Director of “Tax Administration Improvement”, Phyllis Siew, “Assistant Commissioner Inland Revenue to the Chairman”; Sheila Seecharan, ACIR; Audit and Mr. Oswald Goodman “Revenue Planning Officer” allowed us to prepare and obtain high quality information for the aforementioned study, information for the Study on “Transfer Pricing in Latin America and the Caribbean” being carried out under the ITC/CIAT/GIZ collaboration program as well as to discuss alternatives for mutual cooperation in different areas. We take this opportunity to thank the Trinidad and Tobago Tax Administration most sincerely for its contribution to these important studies.
CIAT is a public international organization which groups the tax administrations of 40 countries, (31 Amarican countries, 6 European countries, 2 African countries and one 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.
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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
From left to right: Ms.Deokie Hosein, Mr.Gonzalo Arias,, Mr.Oswald Goodman, Ms. Sandra Nimblett and Ms. Phyllis Siew From left to right; Ms. Deokie Hosein, Board of Inland Revenue of Trinidad and Tobago and Mr. Gonzalo Arias, International Taxation and Cooperation Director of CIAT
Technical Assistance to the Tax Administration in Suriname The Technical Assistance and Institutional Management Directors, Raul Zambrano and Francisco Beiner visited the Tax Administration of Suriname to provide technical assistance in the definition process of Terms of Reference for a new indirect tax management system. The visit took place on August 7th to 10th of this year and included interviews with the units responsible for the administration of direct taxes, indirect, customs, collection and information technology. The mission was financed with resources from the ITC/GIZ/CIAT Collaboration
Program signed in Lisbon on the occasion of the 2011 CIAT Technical Conference.
In the picture: The Minister of Finance, Adelien Wijnerman, the Director of Taxation, Cornelius van Dijk together with the Directors are on the picture.
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The international tax community assists the Central American and Caribbean countries in information exchange To support the efforts of the Central American and Caribbean countries for achieving an effective tax information exchange, several international organizations and initiatives and tax administrations successfully held a workshop in the State of Florida, U.S.A., on July 24 to 26. As a result of joint efforts by CIAT, IDB, World Bank, Global Forum, Guardia di Finanza of Italy and the U.S. Internal Revenue Service, a workshop on tax information exchange was held on July 24 to 26 in the City of Plantation, for providing assistance and promoting the discussion of this issue among Central American and Caribbean countries that are undertaking initial actions in this area. As evidenced in the extensive agenda, the three days of the workshop were devoted to the discussion of theoretical aspects dealing with the necessary legal framework for an effective exchange of information, interpretation criteria to be considered according to international standards, the methodologies commonly accepted for information exchange, as well as practical aspects based on the experiences of tax administrations of developed countries, and other countries that have achieved good results (Bermuda, Cayman Islands, Panama and Jamaica) even though they have only recently begun information exchange. Likewise, the IRS, host and leader of this initiative, submitted case studies based on said institution’s daily practice situations that were solved by the participants within the framework of a group activity. Said panel was most useful for participants in the workshop to improve the quality of their information requests, as well as to become aware of the most common mistakes they may fall into, when making such requests. As a result of this workshop, the participants agreed on the need for the international community to continue its cooperation efforts for assisting the countries that have opted for an effective information exchange, and for which purpose it is essential to count on the collaboration of the tax administrations of countries with significant experience on the subject, as well as international organizations involved in this issue. It was thus made known that CIAT is available to evaluate and coordinate, through the Directorate of International Cooperation and Taxation (Mr. Gonzalo Arias at garias@ciat.org) actions for assisting the member countries and that on September 3 to 7 of the current year, in coordination with OECD, Global Forum, U.S. IRS, SAT of Mexico, AEAT of Spain and Guardia di Finanza of Italy, a theoretical and practical activity on tax information exchange will be held at the OECD’s Multilateral Tax Center in Mexico.
Participantes of the workshop on effective implementation of tax EoI - CIAT/IRS USA
Leticia Arias - Panama
Komal Mohindra World Bank
Gonzalo Arias - CIAT
Duncan Nicol Cayman Islands
Fernando Velayos - IDB
Steffano Gesuelli - Italy
Donald Godfrey - OECD
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Technical Assistance Visit to the DEI of Honduras The Director of Technical Assistance and ICT, Raul Zambrano together with the Consultant Enrique Espinoza carried out a technical visit to the Revenue Executive Directorate of Honduras on July 30th and August 3rd. The visit responded an invitation of the Inter-American Development Bank and aimed at reviewing the progress of the project that the Bank has in that Tax Administration, particularly on issues of large taxpayers and control. From left to right: Henry Castellon, Minister - Director of the DEI; Alejandra Collier, Administrative Coordinator of the IDB - DEI Project; Raul Zambrano; Belinda Perez, Chief of the IDB project; and Enrique Espinoza
The Tax Administrations Inform Argentina - Historical Record: 61.317 million pesos Tax collection in July 2012 totaled 61.317 million pesos, an increase of 28.2% over the same month last year. Carlos Alberto Sánchez Correspondent
Brazil - Electronic Invoices issued exceeded the barrier of five billion The date July 20, 2012 represents an important milestone for the Sped Electronic Invoicing Module (NF-e), for having overcome the barrier of five million electronic invoices issued. Electronic invoicing is a digital document issued and stored electronically in order to document for tax purposes, operations of goods or services. Its legal validity is guaranteed by the sender’s digital signature and the authorization of use provided by the Treasury, before the occurrence of the event. Monthly, 865.630 taxpayers issue NF-e. These taxpayers are responsible for approximately 8.5 million of NF-e daily issued. Flávio Antonio Araújo Correspondent
Brazil -Revenue and ABC sign a memorandum of cooperation with developing countries The Memorandum for the Promotion of Technical Cooperation in developing countries aims at carrying out actions in the tax field by the Federal Revenue Secretariat of Brazil, to be funded by the Brazilian Cooperation Agency (ABC) of the Ministry of Foreign Affairs (MFA). With the signing of the memorandum, the Secretary of the RFB, Carlos Alberto Barreto stressed the importance of the document as it enables the agency to increase cooperation actions to convey their knowledge in taxation to other countries. Jointly signed on August 7th at the ABC Headquarters in Brasilia, the memorandum came into force immediately. The ABC Director, Minister Marco Farani noted that through this instrument the agency expects Brazil to help improve the tax system in developing countries, especially in the customs area.
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The RFB reported that the document will allow the implementation of technical cooperation activities for the benefit of developing countries in Latin America and Africa, especially countries from the Portuguese Language Countries Community (CPLP). The ABC Memorandum is part of a series of initiatives by the RFB in the search for resources to develop training activities in accordance with the Federal Government guidelines to strengthen cooperation with other countries. Funds will be used to finance the transportation of speakers and officials from developing countries and other costs related to operating expenses. The Memorandum for the Promotion of Technical Cooperation in developing countries
Flávio Antonio Araújo Correspondent
France - Report of DGFiP activities for the financial year 2011 As every year, the General Directorate of Public Finances wrote and published in July its Activity Report for 2011. The completion of the merge between the two former tax administrations and public accounting was, without doubt, the relevant event for 2011 at the structuring level as well as the establishment of unified rules for personnel management. The year 2011 also stands out for its excellent results in all the DGFiP areas; for control as well as for public management. In short, 2011 is a great “cru” (harvest) for the French tax authorities
Panama – current revenue grows B /. 400 million in July collected by the DGI In July, current revenue totaled B /. 400.2 million, exceeding by B /. 8.6 million (2.2%), and surpassing the budgeted amount in B /. 16.6 million (4.3%) the collection in the same period of 2011, according to the General Revenue Directorate of the Ministry of Economy and Finance. Tax revenues, both direct and indirect - registered in July show an obvious growth, reaching the amount of B /. 314.8 million, exceeding the budgeted amount in B /. 25.2 million (8.7%) and exceeding the result of the same month last year in B /. 47.9 million (18%).
Paraguay - GIZ starts cooperation with the SET The German Agency for International Cooperation (GIZ in German), with the support of the Inter-American Center of Tax Administrations (CIAT), has started a Diagnostic mission in the State Tax Sub-Secretariat of the Ministry of Finance under a cooperation program. At the opening meeting participated Hans Funs, GIZ Advisor; Irene Ocampos, GIZ National Advisor; Luz Bello, Director of Tax Planning and Techniques; Cesar Ibarrola, Support Director; and Elizabeth Corrales, Head of Cooperation. Elizabeth Fernández de Corrales Correspondent
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Paraguay - IRP Training starts with good receptivity The Ministry of Finance, through the Secretariat of State Taxation, started with good receptivity the training sessions on Personal Income Tax (PIT). More than 200 people interested in knowing about this tax attended the first session. This took place at the Hotel Guaraní, with a massive audience. The Director of Planning and Technical Tax Luz Bello was in charge of the opening session and welcomed the participants. The Director of Support, Caesar Ibarrola was also present. Elizabeth Fernández de Corrales Correspondent
Peru - Authorized Economic Operator will enter in force in October Over 500 companies could apply for accreditation to facilitate foreign trade operations. From October, SUNAT will implement the accreditation for “Authorized Economic Operator”, a certificate that will recognize the commercial activities of the Peruvian operators worldwide, providing a range of facilities in their customs procedures. Over 500 companies will be certified in our country, if they meet the requirements. Thus, Peru joins other Latin American countries that already have this modern facilitation program of foreign trade procedures such as Mexico, Guatemala, Colombia, Argentina, Costa Rica and the Dominican Republic. Clara Urteaga Correspondent
Bolivarian Republic of Venezuela -The SENIAT celebrates the 18th anniversary of service to citizens and impetus to the economic development of Venezuela The National Integrated Customs and Tax Administration Service (SENIAT), through its officials and authorities joyfully celebrated the 18th anniversary of its foundation. For 18 years, the customs and tax administration has offered the country a task-oriented to serve taxpayers, as well as to support the development of the national economy with widely recognized benefits for the Venezuelan people Esther Madrid Blanco Correspondent
Dominican Republic - Directorate of Internal Taxes holds International Seminar on Experiences of Control Process in the Tax Administrations
From left to right: Mr. Carlos López Damm, Ambassador of the Republic of Ecuador to the Dominican Republic; Mr. Carlos Marx Carrasco, General Director of the Internal Revenue Service (SRI) of Ecuador; Mr. Juan Hernández, General Director of the DGII of the Dominican Republic and Mr. Márcio F. Verdi, Executive Secretary of the InterAmerican Center of Tax Administrations (CIAT).
Last Friday, the General Directorate of Internal Taxes held the International Seminar on “Experiences of the control process in the tax administrations of the region”. This activity, framed within the commemoration of the institution’s fifteenth anniversary was held at the Central Bank’s Salome Ureña Auditorium and was headed by the General Director of the DGII, Mr. Juan Hernández, with the participation of over 150 officials of the institution. In his opening statement, Mr. Hernández highlighted the institution’s achievements which have turned it into a modern, exemplary and referential organization at the international level. For this reason, the President of the Republic, Dr. Leonel Fernandez
eCIAT Reyna recently presented it the Duarte, Sánchez y Mella Merit Award in the Great Silver Plate Cross Rank, for its outstanding meritorious services and on occasion of the commemoration of its 15 years of creation. “Within this brief period of time and in spite of interruptions and setbacks, the DGII has become a modern, efficient, reliable and transparent organization. A short while back, Oscar Vásquez, the expert Resident for the Internal Tax Administrations of the Regional Technical Assistance Center for Central America, Panama and the Dominican Republic (CAPTAC) presented a comparative study on the status of the Latin American Tax Administrations and pointed out 14 aspects that afford the DGII a preferential position”. Two important dissertations were presented at this International Seminar. One of the speakers, Mr. Carlos Marx Carrasco, General Director of the Internal Revenue Service (SRI) of Ecuador gave an account of the “Process of modernization of the TA of Ecuador with emphasis on tax control”, while the topic of the presentation by Mr. Márcio Verdi, Executive Secretary of the Inter-American Center of Tax Administrations (CIAT) was “The tax control processes implemented in the Tax Administrations. A comparison with the countries of the Region”.
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The Executive Secretary of the Inter-American Center of Tax Administrations (CIAT), Mr. Márcio Verdi presents a recognition plate to Mr. Juan Hernández, General Director of the DGII of the Dominican Republic in commemoration of the institution’s fifteenth anniversary.
Source: Public Relations Department. General Directorate of Internal Taxes.
The General Director of the Internal Revenue Service (SRI) of Ecuador, Carlos Marx Carrasco and the Executive Secretary of the Inter-American Center of Tax Administrations (CIAT), Márcio F. Verdi, were the speakers in this event.
Mr. Carlos Marx Carrasco, General Director of the Internal Revenue Service (SRI) of Ecuador; Mr. Juan Hernández, General Director of the DGII of the Dominican Republic; Mr. Carlos López Damm, Ambassador of the Republic of Ecuador to the Dominican Republic and Mr. Márcio F. Verdi, Executive Secretary of the Inter-American Center of Tax Administrations (CIAT).
Dominican Republic - Juan Hernandez noted that it is essential to redesign the Dominican tax legislation The Director General of Internal Revenue noted the high performance achieved by the institution in the last eight years by achieving 313% growth in revenues despite the economic sectors that have most contributed to the growth of the Gross Domestic Product which have a tax regime with a low or very low tax burden. Juan Hernandez said so at the opening ceremony of the International Seminar “Process Control Experiences in the Tax Administration of the Region” sponsored by the DGII under its XV Anniversary held last Friday at the Central Bank’s Auditorium, Salome Urena. Nieves Vargas Collado Correspondent
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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.
Post of the Month 7 August 2012
Painting monkeys Written by Raul Zambrano
The tax administration´s structure has followed different guidelines through time. Some have been structured by tax type: income and profits from corporations’ taxes; excise taxes (liquor and cigarettes); vehicles; or estate tax. Others are structured with a typical functional division where collections, audit, and technical - the latter one with different names - are frequently shown at the first level of the structure. More recently, some administrations have been structured by taxpayer type: large business and international; small businesses and self-employed (including professionals, freelancers and single-person shops); employees; tax-exempt and government.
Training Announcement of Course Given the importance we attribute to continued training in order that tax professionals may be fully updated on tax administration, customs and human resources issues we are announcing the following course: · Basic Customs Course 3rd. · Course on Human Resources Management 2nd. · Tax Audit Fundamentals 5st. · Tax Ethics Course 3rd. If you are interested in participating, please fill out the registration form and send it to capacitacion@ciat.org, along with the rest of the requirements.
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Other Documents News and Developments International Tax Compact. ITC June 2012
The purpose of this issue is to offer a concise overview of the key activities, projects and events planned and realised in the field of taxation and development. This edition is organized into the following sections: · Developments at an International Level · Selected Activities at Regional and Country Levels · Analytical Work and Studies · Dialogue, Conferences and Upcoming Events
Realistic Recovery Why Keynesian Solutions will Not Work Vito Tanzi A Forum for Social and Economic Thinking
This study will first consider the original formulation of the Keynesian fiscal policy to highlight some of its limitations. It will then discuss the context in which that policy was originally formulated, while identifying some of its implicit, but often ignored, assumptions. Finally, it will address the question of what realistic strategies (‘exit strategies’) the countries undergoing the fiscal crises could adopt if they are to escape their current predicaments.
Finance y Development (F & D) Volume 49, Number 2. June, 2012
This F&D edition examines the global situation five years after the crisis started. The outlook for the future of the world economy is complex and diverse.