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ISSN 1684-9833 • Year 3 / No.17 /September 14, 2012

The Executive Secretariat Informs Col. Rosario Massino visits CIAT

The Executive Secretariat Informs Col. Rosario Massino visits CIAT CIAT, together with the OECD and the Finance and Public Credit Secretariat of Mexico (SHCP in Spanish) conducted an activity on information exchange for tax purposes.

International Seminar on Tax Intelligence was successfully held in Panama

On Thursday, August 30, Colonel Rosario Massino, Head of the International Cooperation Department- Public Finance Office from the Guardia di Finanza of Italy visited the CIAT Executive Secretariat central office.

During his visit, Col. Massino was accompanied by Lieutenant Colonel Stefano Gesuelli, Head of the Italian Mission. They met with the CIAT Executive Secretary Mr. Márcio F. Verdi and with CIAT Departments heads, discovered the central office and interviewed officials to learn more about how CIAT works.

Col. Massino´s visit reinforces the commitment that the Guardia de Finanza and CIAT have assumed to increase cooperation actions and technical assistance as per the agreement signed during the last CIAT General Assembly.El CIAT

The Tax Administrations Inform Brazil - Tax Education makes a difference in the II Brazilian Congress of Tax Citizenship Brazil - The RFB has a new risk management policy Chile - SII launches pilot plan which validates Transbank slips as vouchers Colombia - DIAN issued more than 150,000 digital mechanisms in seven months Colombia - Continuation of the Training Cycle in Transfer Pricing for DIAN Auditors Supported by the OECD Panama – DGI collects B /. 3724.4 millions - current revenues grow 15.3% to August.

Paraguay – Increase in tax certificates requests

From left to right: Mr. Marcio F. Verdi, CIAT Executive Secretary; Col. Rosario Massino, Head of International Cooperation - Guardia de Finanza Public Finances Office; and Lt.Col. Stefano Gesuelli, Head of the Italian Mission to CIAT.

South Africa - More help available for eFiling IBFD News Post of the Month Training New in the Web Other Documents

Col. Rosario Massino sharing with Directors and Officials at CIAT Executive Secretariat Central Office.

Col. Rosario Massino offers a present to Mr. Marcio F. Verdi.

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CIAT, together with the OECD and the Finance and Public Credit Secretariat of Mexico (SHCP in Spanish) conducted an activity on information exchange for tax purposes.

A seminar was held last September 3-7, at the Multilateral Tax Centre of the OECD in Mexico on information exchange for tax purpose in order to help the ministries of finance and tax administrations from Latin America and the Caribbean to implement the appropriate legal and administrative framework for the information exchange and its effective enforcement.

Le invitamos a CIATalk, el espacio que le brinda el CIAT. Lea los post, opine y participe activamente.

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.

Since 2010, CIAT has joined forces with the OECD and the SHCP to develop an activity that allows us to promote the effective implementation of the tax information exchange between countries in Latin America and the Caribbean.

Given the success achieved, it has been decided to hold an additional edition of this activity during the present year, with a renewed program, which includes theoretical and practical cases to meet the new challenges faced by governments from developing countries in this field.

Thus, last September 3-7, an expert panel was formed with representatives from the AEAT from Spain, Mexico’s SAT, the Guardia di Finanza from Italy, the United States IRS, the OECD and CIAT to discuss in detail issues related to political, legal, and structural aspects, and operational procedures for a proper implementation of this practice.

Participants included representatives from the “Global Forum on Transparency and Exchange of Information” and ministries of finance and tax administrations from Mexico, Brazil, Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Paraguay and Uruguay.

As a result, on the last day a round table was coordinated to acknowledge specific demands and key issues that should be addressed in the region and in turn, be considered in future editions of this seminar. These demands include the automatic exchange of information and interaction with other tax administrations networks.Brasil - La educación tributaria hace la diferencia en el II Congreso Brasileño de Ciudadanía Fiscal

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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

Official photo of the event.

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International Seminar on Tax Intelligence was successfully held in Panama In order to promote the development of intelligence practices for detecting and fighting tax fraud, the European Commission in partnership with CIAT, the Ministry of Economy and Finance of Panama and the Guardia di Finanza from Italy held in Panama City an International Seminar-workshop last August 29 to 31.

CIAT, with the support of its member countries, has accumulated over the years a vast experience in the Tax intelligence field. A proof of this is CIAT Manual on Tax Intelligence published in 2006, which was drafted in the framework of a working group coordinated by the CIAT Executive Secretariat, including experts from Brazil, Canada, Chile, Colombia, United States, France and the Netherlands; and seminars and workshops held in Ecuador and Brazil in 2009 and 2011 respectively.

For several years, the European Commission has also been funding tax programs in Latin America. This activity was a result of EC-CIAT Partnership Program announced at the Technical Conference held in Portugal.

The Guardia di Finanza from Italy, governing authority regarding tax intelligence practices and the seminar technical co-organizer, opened this month a permanent mission at the CIAT Executive Secretariat in Panama in order to convey their experiences to tax administrations of our member countries. This entity, together with CIAT organized in 2011 a visit to their headquarters in Rome, attended by many representatives from Latin American countries.

As a result of that event, Latin American countries tax administrations submitted to CIAT the need for discussion and exchange of experiences areas with legal, administrative structures and procedures allowing identifying best practices to promote future mutual technical assistance.

At this international seminar, participants were officials from 23 tax administrations from Latin America, the Caribbean, Europe and Africa, in charge of tax intelligence actions or research tasks about complex operations with criminal profile in their respective administrations.

The event was inaugurated by CIAT Director of International Tax Cooperation, Mr. Gonzalo Arias with the participation of Cooperation Projects Manager for the European Union Office in Panama, Mr. Eric Dejoie; the Italian Ambassador in Panama, Mr. Giancarlo Curcio and the Deputy Director of the Revenue Department (DGI) of Panama, Mrs. Xiomara de Garrido. At the event were also present distinguished representatives from Embassies of the European Union member countries in Panama, the Ministry of Foreign Affairs and the Specialized University for Certified Public Accountants from Panama.

Speakers included experts from tax administrations of Brazil, Chile, Colombia, El Salvador, France, Italy, Kenya, Mexico and Venezuela. Distinguished officials from the tax administrations of member countries such as Aruba, Bolivia, Costa Rica, Ecuador,

Main table during the opening session: from left to right: Mr. Gonzalo Arias, CIAT Cooperation and International Tax Director; Mr. Giancarlo Curcio, Ambassador from Italy in Panama; Mr. Eric Dejoie, Administrator of the European Union Cooperation Projects Offices in Panama; and Mrs. Xiomara de Garrido, Sub-Director of the Income General Directorate (DGI) of Panama.

At the closing of the International Tax Intelligence Seminar: From left to right: Mrs. Xiomara de Garrido, Panama DGI SubDirector; Mr. Marcio Verdi, CIAT Executive Secretary; and Lt. Col. Stefano Gesuelli, Head of the Italian Mission to CIAT.

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Guatemala, Haiti, Paraguay, Peru, Dominican Republic, Trinidad and Tobago and Uruguay participated. Special guests from COTA member’s countries: British Virgin Islands and Saint Lucia also attended.

Finally, Mr Stefano Gesuelli , Lieutenant Colonel of the Guardia di Finanza; Mr. Márcio Verdi, CIAT Executive Secretary; and Mrs. Xiomara de Garrido , Assistant Director of the DGI from Panama, closed the event.Brasil -La RFB tiene una nueva política de gestión de riesgos

General view of the participants to the International Tax Intelligence Seminar.

Mr. Marcio Verdi, CIAT Executive Secretary, addresses the participants of the event.

The Tax Administrations Inform Brazil - Tax Education makes a difference in the II Brazilian Congress of Tax Citizenship The II Brazilian Congress on Tax Education was held in Sao Jose dos Campos / SP, at the SESI Theatre on August 15 and 16. The aim was to discuss strategies for Tax Education and Social Control of Public Expenditure.

The event was organized by the local RFB unit and the State University of Maringá. Taxation and human dignity, commitment to citizenship, tax responsibility, transparency and awareness were the central topics of the event which attended by over 350 people.

The Congress was a time for reflection and exchange of experiences on Tax Education. It concluded that there is a need to increase knowledge about taxes for the construction of a more just and conscientious society.

The auditorium was full of teachers, employees and representatives from the civil society encouraging the event organizers.

The program included lectures about National Education on Tax Education in the interdisciplinary context; it projected films, panel discussions and presentations, especially the play “The Fiscal Boat” by the Abaecatú Group.

The event gave an immediate response by having 89 people interested in attending the Social Observatory of São José dos Campos, by expanding the local Tax Education Group, by giving new educational projects, by the mobilization of representatives from various organizations present in the event, in addition to the work presented for analysis.

Flávio Antonio Araújo Correspondent

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Brazil - The RFB has a new risk management policy Risk management methodology should be immediately applied to all projects considered strategic by the Cabinet and to processes under mapping for improvement. This is what determines the new RFB risk management policy established by the RFB Ordinance No. 2027 of 08.17.2012.

The actions aimed at the development, dissemination and implementation of the risk management methodology are designed to support the continuous improvement of work processes and projects as well as encourage the efficient use and allocation of available resources, which contributes to the achievement of institutional objectives and mission.

For the initial implementation, thirty officials are involved in the allocation process from the respective areas, to attend the Risk Management course on August 27-31, 2012, in order to begin training for the implementation of risk management as the permanent activity in these processes. Other RFB activities should implement risk management over the next four years.

The Risk Management Network was also created. Its officials will be responsible for the dissemination and application of the risk management methodology in the RFB action areas.

Chile - SII launches pilot plan which validates Transbank slips as vouchers To facilitate voluntary compliance and reduce tax fraud related to non-delivery of sales and services vouchers, the Internal Revenue Service (IRS), together with Transbank, started a project for the debit / credit cards transactions slips to be valid as vouchers.

Internal Revenue Service and Transbank have launched today a pilot plan where the credit / debit card transaction slips will be accepted as business vouchers, with benefits such as costs savings associated with printing and storage of certificates stubs and stamping, plus the elimination of double issuing of documents, The pilot project, which became operational in 11 SMEs of various sectors located in Santiago, will benefit not only to companies, but also to final consumers who will pay in a simpler, faster way and with less use of paper, which also contribute to environmental conservation.

Bernardita Moraga Correspondent

Colombia - DIAN issued more than 150,000 digital mechanisms in seven months The Tax and Customs Administration (DIAN) issued 151,218 digital signature mechanisms within the seven (7) first months of 2012, due to campaign facilitation and streamlining of tax filings.

This means that in seven (7) months the entity managed to issue the same number of mechanisms than during six (6) years, i.e. 45% of the 334,635 total active digital mechanisms.

The campaign aimed to provide DIAN customers with a faster filing and submission process for returns and information, among other virtual procedures. Its impact is reflected on the increase in the number of VAT returns and withholding at the source submitted through the Entity’s online Services.

Patricia Parada Castro Correspondent

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Colombia - Continuation of the Training Cycle in Transfer Pricing for DIAN Auditors Supported by the OECD With a participation of more than 20 DIAN auditors, the second workshop on transfer pricing was held last July 31 to August 2 in order to continue the process of strengthening the knowledge of the team in charge of research focused on improving the skills and control techniques. They also shared different experiences from cases developed by officials from the Control and Execution Department located in the Sub-Directorate of International Control in the Taxes Directorate Division in Bogota, the Large Taxpayer Department and the Legal Management Department.

Advisers Lee Corrick and Mayra Lucas from the OECD shared their experiences with the DIAB team. At the request from DIAN, a mining expert (Professor Johannes Cilliers, geologist at the Imperial College in London) participated this time and gave a comprehensive technical overview of the mining industry from the private sector perspective. Dr. Arcotia Hatsidimitris from World Bank was also present in support of the program.

This training is part of a long-term project executed within the program OECD Task Force on Tax and Development responsible for providing support and resources to developing countries to strengthen the capacity of tax authorities and improving collection. This project is developed mainly under the bilateral agreement between the OECD and Colombia, in partnership with multilateral organizations such as the World Bank, the International Monetary Fund and the European Commission.

Patricia Parada Castro Correspondent

Panama – DGI collects B /. 3724.4 millions - current revenues grow 15.3% - to August.

The Revenue Department of the Ministry of Economy and Finance has reported that current revenues accrued through August, 2012 sum B /. 3724.4 million, representing a growth of B /. 493.7 million, i.e. 15.3%, compared to the same period last year and a budget surplus of B /. 100.1 million (2.8%).

Until August, the tax revenues collection reaches the amount of B /. 3.017.8 Millions, from which B /. 1.564.6 are direct taxes and B/1.453.2 are indirect taxes.

Tax revenues represent about 83% of the current income and show a growth of B /. 526.3 millions (21%) compared to the same period last year.

Paraguay – Increase in tax certificates requests State Taxation Sub-secretary (SET) of the Ministry of Finance records high demand of requests for Tax Compliance Certificates and Non-taxpayer certification. Between January and July of this year, a total of 323,202 certificates have been delivered to taxpayers upon request.

The Certificates, issued by the Tax Administration as established by the General Resolution N° 8/08, are required to formalize various acts, i.e. applying for patents, to obtain a passport, to sign properties or vehicles deeds of sale, among others.

Elizabeth Fernández de Corrales Correspondent

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South Africa - More help available for eFiling The latest service initiative by the South African Revenue Service (SARS) to help taxpayers with eFiling went live this morning.

From today, taxpayers who are unsure about how to use eFiling or who get stuck while completing their returns online can make use of the Help-You-eFile service, a new facility which allows them to be in direct contact with a SARS Call Centre agent while they complete their tax return online. With permission from the taxpayer, the facility enables the Call Centre agent to access the taxpayer’s eFiling browsing session at the same time as the taxpayer and to see exactly what the taxpayer is seeing.

This is the first time any revenue service around the world has instituted such a system and SARS is proud to be at the forefront of such technological advancements.

Varsha Singh Correspondent

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 September 13

Algo aburrido, y sin embargo Written by Raúl Zambrano (Available in Spanish) En aquel Post de los 10 minutos, en el tercer punto, hablé sobre XBRL y creo que es momento de profundizar un poco.

El 7 de agosto pasado, la Fundación IFRS publicó las etiquetas en Castellano de las IFRS o NIIF basadas en XBRL. El “Resumen de Proyecto” con que se presentó la taxonomía 2012, presentada en marzo, nos cuenta que esta es la representación en XBRL de las NIIF, tanto las completas como el subconjunto dirigido para medianas empresas e incluye estándares contables e interpretaciones.

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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: • • •

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 Estimación del Incumplimiento Tributario en América Latina: 2000-2010 Miguel

Pecho Trigueros, Fernando Peláez Longinotti y Jorge Sánchez CIAT Documento de Trabajo Nº 3-2012 (Available in Spanish)

According to the study, there is evidence of VAT and IRPJ non-compliance reduction for Latin American countries in the 2000-2010 Period. The calculated productivity ratio shows a reduction of 21.3% and 17.6% in the collection inefficiency for VAT and IRPJ, respectively, between the first and second five-year periods. Similarly, in the case of IRPJ, collected calculations and other work performed by the authors under the theoretical potential method using National Account, report for a reduction of the non-compliance between the first and second five-year periods from 11.6% on average for the first and 19.7% on average for the second. The best results for the 2006-2010 period is further confirmed with the estimates obtained in the last section of the paper that uses data from the management of TA derivate from the IDB , CIAT, CAPTAC-DR study. If all non-compliance results are averaged for both taxes, with the exception of registry and payment gaps gap, the non-compliance average level obtained for the Latin American countries has an average of 30.4%, a level that is below the average of 37.8% for the other estimates. Sectorial estimates are still needed in order to be more conclusive, but the downward trend is confirmed.

Other Documents The Global Village

Finance and Development (F&D) International Monetary Fund Volume 49. Number 3 September 2012 Since we lived in a more globalized and interconnected world, the ideas, the information and the technology spread very fast. The globalized economy has created a complex and joint network of currents capitals and trade that has produced great economic benefits, helping hundreds of million people from poverty throughout the world. This F&D Edition examines different aspects from that interconnection.