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ISSN 1684-9833 • Year 3/ No.16 / August 31, 2012

The Executive Secretariat Informs The Executive Secretariat Informs The Executive’s Council Finance SubCommittee meets at CIAT Headquarters ITC supported by CIAT concludes diagnostic mission in SET The Tax Administrations Inform Argentina – Fiscal Data: AFIP (in Spanish) has implemented a new tool against tax evasion Brazil - The CPF can be done now via Internet for free Chile - SII launches three electronic sites for small entrepreneurs

The Executive’s Council Finance Sub-Committee meets at CIAT Headquarters From August 27 to 29, the CIAT Executive Council Finance Sub-Committee met at the Executive Secretariat.

The agenda included the review of the previous report recommendations (January 2012), the revision of the budget implementation from 2011 to 2012, and the financial statements analysis as of June 30, 2012, recently audited by an independent audit firm.

The Sub-committee includes specialists Irene Carrizo, DGI, Panama; David Peguero, DGI, Dominican Republic; and Luis Antonio Velazco, SRI, Ecuador.

The report drafted by the Sub-committee will be submitted by the Executive Secretariat to the Executive Council at the meeting to be held in Amsterdam next Sunday, October 14, before the CIAT Technical Conference starts.

El Salvador - Minister of Finance awarded with Prize as the 2012 Economist France - Bruno Bézard, new General Director of the DGFiP Honduras - Change in the Revenue Executive Directorate Administration Nicaragua - DGI celebrates the first anniversary of the tax solvency online for taxpayers Paraguay - Simple corporations are IRP first taxpayers Dominican Republic - Guarocuya Félix assumes the DGII General Directorate Dominican Republic – Internal Taxes issues the 02-12 regulation on the trusts tax regime Uruguay - Issued the first Electronic Invoicing

Photo: The Executive’s Council Finance Sub-Committee in working session with Xiomara de Tejada and F.J. Beiner

ITC supported by CIAT concludes diagnostic mission in SET The International Tax Compact (ITC), with the Inter-American Center of Tax Administrations (CIAT) support, completed a diagnostic mission in the Sub-secretariat of State Taxation, Ministry of Finance, as part of a cooperation program.

Mr. Hans Fuchs, GIZ Advisor; Irene Ocampos, Municipal Management Coordinator, GIZ office in Asuncion; and Francisco J. Beiner, CIAT Director of Operations and Institutional Management held a series of meetings with Tax Administration Officials.

During the working sessions which included the Large Taxpayers, Collection and Planning Directorates as well as the Staff and Computer Coordination, different issues involving cooperation requests were presented.

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Irene Ocampos, Francisco Beiner and Hans Fuchs during a working session.

The Tax Administrations Inform

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.

Executive Council Executive Secretariat The e-CIAT Newsletter is published and distributed electronically biweekly.

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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

Argentina – Fiscal Data: AFIP (in Spanish) has implemented a new tool against tax evasion The Federal Administration of Public Revenue (AFIP) will implement “DATA FISCAL”, a new interactive form that will help consumers to know the tax behavior of businesses when purchasing goods or services. The new tool, which will be mandatory for businesses, will replace the current “960 – Request your invoice”, “Tax Monitors” and “Registration Voucher”. This is part of the Agency’s strategy to maximize the use of the available technology and “ex-ante “controls.

This new mechanism was announced by the AFIP head Mr. Ricardo Echegaray in presence of the CIAT Executive Secretary, Mr. Márcio F. Verdi and representatives of the country’s main chambers of commerce, services and industry. The international agency official expressed that “the use of information technology to improve the efficiency and effectiveness of tax administrations, also reduces the cost of taxpayers’ obligations. This is compliance simplification action”.

Brazil - The CPF can be done now via Internet for free Free registration in the Register of Individuals (CPF in Portuguese) is available from August 2nd, at the web site http://www.receita.fazenda.gov.br/ the link “CPF Registration on Internet”. The service applies to taxpayers who have the voter’s registration card.

Registrations will be free of charge via Internet and the number comes out immediately.

At the announcement of this new service available to citizens 24 hours a day, 7 days a week, the Deputy Secretary of Collection and Attention Service described it as “one of the most modern in the world”. For him, this is another important service provided by the Brazilian Federal Revenue (RFB), to make people’s lives easier.

The RFB chose as the basis of information the voter registration card for its inclusion in electronic form, as it is a document available nationally and before adulthood. The agency may allow other document to be used as database for registration, depending on studies performed at the time.

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The CPF registration on Internet does not end the other traditional channels of service. A person who has a voter registration card may still apply for registration through the usual entities. Taxpayers who do not have a voter registration card (for example, minors and foreigners) should continue to use the usual entities. Similarly, in the case of inconsistencies in the data reported, applicants are directed to a RFB service unit to make their request.

Chile - SII launches three electronic sites for small entrepreneurs The Internal Revenue Service (SII) has joined with specific actions the program “Despegapyme”, developing three Internet sites for the micro and small enterprises (MSEs) to be informed and even more important, could take specific actions to facilitate tax compliance: www.14 quater.cl, www.facturaelectronicamipyme.cl and a guideline for entrepreneurs.

“For a long time, the SII had a clear commitment to the world of small entrepreneurs that goes far beyond words and we demonstrate it today with facts. We have now available three electronic sites which will be tools for entrepreneurs to incorporate technology to tax compliance, “said the SII Director, Julio Pereira.

Bernardita Moraga Correspondent

El Salvador - Minister of Finance awarded with Prize as the 2012 Economist The Minister of Finance, Mr. Carlos Caceres was recognized as the “2012 Economist,” last August 17. The award was given by the Association of Professionals in Economics (COLPROCE), during the Economist week held from August 13 to 17.

The Minister of Finance was chosen after a strict selection of six professionals in economics which were nominated and selected by the COLPROCE members who took into account the integrity, values, academic and working curriculum for each candidate.

Ramón Pérez Gómez Correspondent

France - Bruno Bézard, new General Director of the DGFiP Bruno Bézard, born May 19, 1963 in Chauny (Aisne), is Inspector General of Finance and an alumnus of the École Polytechnique and the École Nationale d’Administration.

He served as a finance inspector at the French Inspectorate General of Finance from 1988 to 1992.

Bruno Bézard subsequently held various positions at the Treasury Department until January 2000.

Successively Deputy Chief of Staff for the Minister of Economy, Finance and Industry, sub-Director in the Treasury Department for development assistance, multilateral banks and emerging countries and Vice-Chairman of the Club de Paris, he went on to serve as Economic and Financial Advisor to the Prime Minister from mid- 2001 to April 2002.

Bruno Bézard General Director DGFiP

From April 2002 to March 2003, he was Head of the Equity Investments Department at the Treasury Department before being appointed Deputy Managing Director of the French State Shareholding Agency (APE) in March 2003 and then its Managing Director in February 2007.

Since September 2011, Bruno Bézard has been Minister Counsellor for Economic and Financial Affairs and Head of the Regional Economic Department at the French Embassy in Beijing. Bruno Bézard was appointed Director representing the French State by ministerial order of December 24, 2010, replacing Pierre Graff.

Now, since the 1st of August of 2012, Mr. Bezard became General Director of the General Direction of Public Finances.

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Honduras - Change in the Revenue Executive Directorate Administration President Porfirio Lobo Sosa sworn last Wednesday, August 23 the three Supervisory Commission members of the Executive Directorate of Revenue (DEI) at the Presidential House Lenca Hall. They will be responsible for the administration of this institution and will conduct an evaluation of the same with the Superior Court of Accounts (TSC in Spanish) advice and other public and private institutions as it deems appropriate.

The commission includes Reinaldo Rodríguez Martínez, Roberto Jerez and Jorge Yllescas Oliva who took oath before President Lobo Sosa.

Officially, the commission has the powers set out in the decree that creates it and it was approved at the extraordinary Ministers Council as defined in Article 100 of the Public Administration General Law and by other legal regulations that will additionally apply.

For the performance of its duties, the Commission is empowered to request cooperation, participation and integration of other public or private agencies as it considers relevant.

Mr. Reinaldo Rodríguez who by decree presides the board, has a degree in Public Accounting. He was the first president of the Honduran Institute of University Professionals in Public Accounting (COHUCP in Spanish). He is the Technical Board Chairman of the Accounting Rules and Audit (JUNTEC in Spanish) and a university professor of Accounting with 35 years of experience in audit at the well-known international firm PriceWaterhouseCoopers.

Mr. Roberto Jerez is a Certified Public Accountant. Former Vice President of the National Banking and Insurance Commission (CNBS in Spanish) and currently he is an advisor to that agency. He was JUNTEC first president and member of the Comptroller Board of the National Institute for Teachers (INPREMA in Spanish).

Mr. Jorge Yllescas was head of the DEI under President Carlos Flores government. He was head of the Customs General Directorate, Director to the Central Executive Council for the Liberal Party. He is the author of several books, the most recent one titled “Corruption and Impunity” and the most notorious one, the “Yllescas Report” which is about tax fraud.

Nicaragua - DGI celebrates the first anniversary of the tax solvency online for taxpayers The DGI has developed its 2012-2016 Strategic Plan which offers electronic services as a taxpayer assistance key component, thus assuming the commitment to improve the assistance, coverage and service to taxpayers.

To celebrate the first anniversary of electronic Tax Solvency, the DGI has decided to share the results of this innovative tool which has facilitated and simplified the assistance and procedures for taxpayers.

Since last August 9, 2011, with the General Administrative Provision No.03-2011, the Head of the DGI provided the taxpayer with the use of the tax solvency service from the electronic tax window (VET in Spanish) obtaining to date over 33,500 online transactions. As of June 2012, 50 percent of the tax solvencies at national level are made from the VET, issuing 240 electronic tax solvencies online per day, equivalent to issuing an electronic solvency every six minutes.

Elías Álvarez M. Correspondent

Paraguay - Simple corporations are IRP first taxpayers Simple corporations incorporated before August 1st are the first taxpayers bound by the personal Income Tax which went into force at the beginning of this month. The State Tax Sub-Secretariat has registered a total of 867 simple corporations in the Single Taxpayer Registry (RUC).

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The Tax Administration is analyzing the list of these corporations in order to discharge the IRP obligation in the coming days as set

by Decree 9371/12 in Art 60 inc a).

Elizabeth Fernández de Corrales Correspondent

Dominican Republic - Guarocuya Félix assumes the DGII General Directorate Mr. Guarocuya Félix assumed his new duties as the Director General for the Dominican Republic General Directorate of Internal Taxes (DGII in Spanish) on August 20.

Mr. Guarocuya Félix has a PhD in Economics from the University of Barcelona,Spain, a Postgraduate Diploma in International Relations from the Latin American Faculty of Social Sciences and a Bachelor in Economics from the Instituto Tecnológico de Santo Domingo. He has been a Fellow Researcher at the Instituto Universitario de Estudios Europeos at the Universitat Autónoma de Barcelona and Professor of International Economics at the Instituto Tecnológico de Santo Domingo.

Mr. Guarocuya has been the Government and Public Policy Coordinator at the Latin American Faculty of Social Sciences, Headquarters in Dominican Republic. He has served as a local consultant on programs with funds from the Inter-American Development Bank, IDB, and has published several specialized papers on Trade Policy, Strategic Trade, The Role of the State in the Economy and the Relationship between Industrial Policy and Growth. As a member of the economic consultants and financial firm DASA, he participated to the FTA negotiations with the United States and Central America. He was the National Planning Office Director (ONAPLAN in Spanish), Undersecretary of State for Planning, and the Superintendent of Securities for Dominican Republic.

Dominican Republic – Internal Taxes issues the 02-12 regulation on the trusts tax regime The General Directorate of Internal Taxes (DGII in Spanish) announced the entry into force of the General Standard 02-12 on the Trust tax regime which establish the requirements and procedures that Trusts and parties involved since its formation to extinction should comply with before the Tax Administration.

The provision describes the mechanisms for ITBIS (in Spanish) compensation on low cost housing that will benefit the final purchasers of the properties and it describes the Trust tax regime and the information referral system regarding their tax liability. The full text of the regulation is available on the Internet site www.dgii.gov.do Nieves Vargas Correspondent

Uruguay - Issued the first Electronic Invoicing The electronic invoicing system is based on the Electronic Tax Receipts, digital documents electronically generated and signed in a pre-established format by the DGI which have the same legal and tax validity as the invoices and other printed documents.

Last August 20, 2012, the “Electronic Tax Receipts” (e-invoice) system was presented as a result of a joint work between the DGI and the Pilot Plan companies that have accompanied this process.

“Tienda Inglesa”, the first company authorized to operate with electronic tax documents was also the first one to make a transaction with this system at its business premise in Montevideo Shopping Center.

At this opportunity, the Director General of Revenue Mr. Paul Ferreri in the presence of the Minister of Economy and Finance, the Pro Secretary of the Presidency and authorities from “Tienda Inglesa” referred to the importance of this technological innovation which places the DGI as one of the most developed tax administrations in the area of e-government.

Margarita Faral 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 30 August 2012

And surely you don´t have anything to tell about this Ferrari?

Written by Raul Zambrano

In a previous CIATalk post (Take your review now!) I commented how we had used the fast answer codes to get links to our review and some potential applications within the Tax Administration framework. Last Tuesday, August 28 in Buenos Aires, we had the opportunity to attend the presentation of a new mechanism that the always innovative AFIP is launching: the “Data Fiscal”.

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.

New in the Web Regímenes Simplificados de Tributación para Pequeños Contribuyentes en América Latina / Simplified taxation regimes for small taxpayers in Latin America Miguel Pecho CIAT July 2012 (Available in Spanish) The study was presented at the “Taxation and Growth with Equality” Seminar organized by ECLAC, ITC and AECID last August 13 - 14, 2012.

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There are fourteen (14) Latin American countries to date that are using, alternatively or simultaneously, single tax or tax regimes that only operate under the VAT or the income tax (IR) framework.

Our Documents Bibliographic News August, 2012

This document provides for reference purposes, the most recent documents produced by CIAT and other editorials in the month of August; either articles or other periodic publications, research works and studies of interest.

Other Documents Seminar: Taxation and Growth with Equality Organized: ECLAC, ITC and AECID Santiago - Chile August 2012

The papers were presented at the “Taxation and Growth with Equality” seminar held at ECLAC headquarters in Santiago, Chile from August 13 to 14, organized by the Economic Development Division with the support of the AECID, the German Cooperation (GIZ), and the International Tax Compact (ITC).

The purpose of the seminar was to promote the discussion about the main aspects that a tax policy should consider when aiming for equality and that at the same time be compatible with a sustainable growth strategy.

Fiscal Institutions of Tomorrow

Gustavo García, Mario Sanginés, Carlos Pimenta, Martin Chrisney, Gustavo Crespi and Ana Corbacho IDB 2012 The publication, describes how fiscal discipline enabled many countries to avoid the bouts of volatility, high inflation and devaluations that marked the 1980s and 1990s. The benefits of this discipline were evident during the recent global economic crisis, in which the region showed its resilience and ability to stage a strong recovery.