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ISSN 1684-9833 • Year 3 / No.2 / February 3, 2012

The Executive Secretariat Informs The Executive Secretariat Informs Announcement for contributions to the N° 33 Edition of the Tax Administration Review

Announcement for contributions to the N° 33 Edition of the Tax Administration Review

CIAT Executive Secretariat participates in the XXIV CIAT Regional Seminar on Fiscal Policy

I am pleased to contact you once again and invite you to send your contribution to the No.33 edition of the Tax Administration Review published by the CIAT together with the Agencia Estatal de Administración Tributaria and the Instituto de Estudios Fiscales.

IRD acknowledges Raul Zambrano in recent visit to the Barbados Tax Administration The Ethics Committee of Federal Revenue of Brazil is created and installed

The topics approved by the Editorial Board for the No. 33 edition are:

The Tax Administrations Inform Bolivia - SIN confirms record tax collection at December 31, 2011 Brasil -The Federal Revenue of Brazil - RFB welcomes delegation from China Brasil -Special Unified System of Tax and Fees Collection by Microbusinesses and Small and Medium-Sized Businesses – “Simples Nacional” closed 2011 with approximately 5.7 million selected taxpayers Chile - Record Registration of Entrepreneurs in Electronic Invoicing in Chile Colombia – DIAN will strengthen examination with new corporate income tax return form Bolivia - SIN confirms record tax collection at December 31, 2011 Honduras - Historic collection in Customs Nicaragua - DGI submits its 20122016 strategic plan to IMF tax experts Paraguay - Increase in Treasury procedures via Internet South Africa - Tax returns exceed 4 million milestone IBFD News Events Post of the Month Training New in The Web Our documents Other Documents

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1. Examination and control mainly of such areas of interest as exporters, banks and financial institutions, extraction of natural resources, agriculture, construction, tourism, and telecommunications.

Impact on collections of recovery and examination activities of the tax administrations.

Effective implementation of international exchange of tax information.

Transparency of information: how tax administrations face problems associated with tax secrecy, bearer shares, tax havens, among others.

Planning in the Tax Administrations:strategic and operational indicators. The balanced scorecard and management by objectives.

Control and internal audit systems in the Tax Administrations.

Neural networks and risk analysis: deterministic and probabilistic predictive models for selecting of cases for audit and collection.

Incorporation of biometric data in the taxpayer file.

If there is a contribution dealing with a topic other than those approved by the Editorial Council, please contact directly the Tax Studies and Research Director, Miguel Pecho (mpecho@ciat.org), to evaluate the relevance of the contribution in question The deadline expires on April 13, 2012. Additional details may be found at our web site.

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Tax Administration Review CIAT/AEAT/IEF N° 31

CIAT Executive Secretariat participates in the XXIV CIAT Regional Seminar on Fiscal Policy Francisco J. Beiner, Operations and Institutional Management Director participated for the CIAT Executive Secretariat, who performed a joint presentation with ECLAC and OECD on Tax Statistics in Latin America.

As part of the seminar the Latin-American Fiscal Observatory (OFILAC in spanish) was launched, which seeks to contribute to the improvement of fiscal policy in the region through the dissemination of studies and debate among the various actors involved in the matter.

OFILAC is an ECLAC initiative that also includes the OECD, the Inter-American Center of Tax Administrations (CIAT) and the Institute for Fiscal Studies (IEF in spanish).

The Observatory’s Internet website, includes news, activities, statistics and publications on the current fiscal situation of Latin America and the Caribbean, it is addressed mainly to economic authorities, international officials, academics and students.

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

In the picture from left to right: Juan Pablo Jiménez, ECLAC, Christian Daude, OECD y Francisco J. Beiner, Operations and Institutional Management Director

IRD acknowledges Raul Zambrano in recent visit to the Barbados Tax Administration On January 9-13, 2012, the CIAT Director of Technical Assistance and Information and Communication Technologies, Raul Zambrano, visited the Inland Revenue Department of Barbados to review improvements to the integrated tax administration current account system.

During said visit, the IRD presented Mr. Zambrano a recognition plaque for his outstanding contribution to the development of the E-Filing system in Barbados.

Recognition Award to Eng. Raul Zambrano

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The Ethics Committee of Federal Revenue of Brazil is created and installed

By Internal Resolution No. 3615 of November 4, 2011, published in the Official Gazette on November 9 of the same year, the members and the substitute members, as well as the Executive Secretary of the Ethics Committee of Federal Revenue of Brazil were appointed.

With the appointment of its members, the Commission established by the Internal Resolution No. 3262 of August 19, 2011, it will be responsible for monitoring the possible unethical behavior and the imposition of different penalties according to the Rules of Procedure of the Federal Revenue, which was approved on November 28, 2011 The RFB will create an Internet page focused on the Ethics and Fiscal Citizenship, through which public servants can become familiar with ethical rules, internal regulations and related legislation, as well as news about Moral Tax, Tax Education, Ethics in the Tax Administration, Citizenship and Transparency.

The public servants can also access an electronic form for making inquiries regarding the topic.

This is a big step taken by the Brazilian tax authorities, which has been very active in the CIAT Working Group on Ethics, which has now become a Permanent Committee co-sponsored by the Canadian CRA one of the most important achievements and initiatives of the Centre, on a topic where it has a clear leadership as an international organization.

Meeting of the Sub-Advisory Committee of Financial Affairs The meeting of the Sub-Advisory Committee of Financial Affairs of the CIAT Executive Council was successfully completed. It took place from the 23rd to the 27th of January 2012 in the CIAT Executive Secretariat in Panama City.

Sub-Advisory Committee of Financial Affairs of the CIAT Executive Council

Mr. David Peguero, Chief Financial Officer of the General Directorate of Internal Taxes of the Dominican Republic; Mrs. Irene Carrizo, Coordinator, Plans and Programs of the General Directorate of Revenues of the Ministry of Economy and Finance of Panama; and Mr. Galo Viteri, General Advisor of the Internal Revenue Service of Ecuador participated to the meeting.

The CIAT Executive Secretariat was represented by Mr. Socorro Velazquez, Planning and Institutional Development Director; Mrs. Xiomara Olivares de Tejada, Accounting and Finance Director; and Mrs. Julia Fontaine, Planning and Control Coordinator.

The final version of the financial statements audited as of June 30th, 2011, which were analyzed in the previous meeting, were reviewed. The 2011-2012 Budget and its execution until the month of December, 2011, were also examined. The review included the analysis of pertinent documents and their discussion with the Directors of the diverse programs.

Another important subject, the budget project revision for the period 2012-2013, was thoroughly discussed by the participants.

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The Tax Administrations Inform Brasil -The Federal Revenue of Brazil - RFB welcomes delegation from China On friday, January 13th, the Coordination General of International Relations – Corin received the delegation from the Chinese Administration of Taxation. The visit was focused on the theme “Large Taxpayers”.

The foreign delegation was formed by Li Wang, Deputy Commissioner of State Administration of Taxation, Zuying Gong, Director General of International Department, Huipin Miao, Deputy Director of Income Taxation Department, Xiaoguo Hu, Deputy Director General of Large Business Administration Department, Nan Zhang, Secretary of the General Office, Yungen Gao, Deputy Director of Non Resident Taxation Division.

Flávio Antonio Araújo Correspondent

Brasil -Special Unified System of Tax and Fees Collection by Microbusinesses and Small and Medium-Sized Businesses – “Simples Nacional” closed 2011 with approximately 5.7 million selected taxpayers Legislative changes, accelerated growth of businesses and individual micro-entrepreneurs, selected taxpayers and new technological tolos for examination are some of the challenges posed to the Managerial Committee of Simples Nacional-CGSN this year. Silas Santiago, Executive Secretary of the CGSN made a balance of the activities of Simples Nacional in 2011.

Flávio Antonio Araujo Correspondent

Bolivia - SIN confirms record tax collection at December 31, 2011 The State’s General Budget established the goal of Bs 24.978 million for 2011, which figure was exceeded by the collection obtained, thus showing a growth in absolute terms The National Tax Service (SIN-Spanish acronym) confirmed record tax collection at December 31, 2011, having reached the official amount of Bs 30.201.2 million, 25% more with respect to 2010 when it obtained 24.112 million Bolivianos.

The Executive President, Mr. Roberto Ugarte Q., reported that the projections had been fulfilled, inasmuch as there is a 25% increase equivalent to an additional Bs 6.089,2 million, when compared with the official figure of 2010.

Source: Sitio web -SIN Juana Patricia Jiménez Soto Correspondent

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Chile - Record Registration of Entrepreneurs in Electronic Invoicing in Chile In 2011 a record number of small entrepreneurs registered in Mipyme Electronic Invoicing, thus totaling 9,896 users for a 32% increase with respect to 2010.

Also, adherence to the regular Electronic Invoicing set a record of entrepreneurs registered in 2011, thereby totaling 2,190 users for a 41% increase as compared to 2010.

In 2011, the total of electronic invoice issuers amounted to 40,188 of which 7,958 are large businesses, while 32,230 belong to the micro, small and medium-sized sector (Mipyme).

Source: Web site Bernardita Moraga Correspondent

Colombia – DIAN will strengthen examination with new corporate income tax return form In order to undertake an effective examination of the information provided by corporations in their income tax return, DIAN has modified form 110.

The new form must be fully completed by those who at December 31, 2011 are classified as large taxpayers, corporations with the capacity of importers, income and complementary tax filers who would have declared gross income exceeding 3 billion Pesos and, or gross net worth exceeding 3 billion pesos in the 2010 fiscal period. They must enter the disaggregated data in form 110; that is, from now on they must also include accounting values that may allow for determining absolute values for each item.

Patricia Parada Castro Correspondent

Honduras - Historic collection in Customs The figures reached are historic in customs collection Only a few days after the conclusion of the year 2011, the Customs Directorate reported collection exceeding the goal determined. It collected over 13 billion Lempiras, thereby exceeding 100 per cent compliance.

Source: Web site Grace de la Paz Saravia Correspondent

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Nicaragua - DGI submits its 2012-2016 strategic plan to IMF tax experts The tax planning and intelligence projects that will continue to be implemented as a control and security strategy for each sphere were highlighted As part of the strengthening and modernization process being promoted by the General Directorate of Revenues, officials from this institution met with IMF Tax Experts to present the DGI’s Strategic Plan which covers the working period between 2012 and 2016.

In his presentation in this meeting, the General Director of Revenues, Mr. Martín Rivas Ruiz, explained the DGI’s fiveyear strategic plan, which is focused on collecting more taxes to combat the country’s poverty by means of an Integral Vision Plan which involves the use of state-of-the-art technology and the provision of multiple on-line services.

Source: Web site Elías Álvarez Correspondent

Paraguay - Increase in Treasury procedures via Internet In 2011, there was an increase in the number of access codes provided by the State Undersecretariat of Taxation of the Ministry of Finance for undertaking procedures via Internet. A total of 30,409 new access codes to the Marangatu System were issued.

The access code allows taxpayers to carry out processes through the Tax Administration’s web page, such as filing their returns, requesting the Tax Compliance Certificate, printing their Statement of Account, registering in the special systems, among other services, in a speedy and easy manner and at any time of the day.

Elizabeth Fernández de Corrales Correspondent

South Africa - Tax returns exceed 4 million milestone South African taxpayers have raised the tax compliance bar yet again.For the first time in this country’s history the number of individual tax returns received for any specific tax year has exceeded the 4 million mark.

By Thursday 26 January 2012, the South African Revenue Service (SARS) had received 4,010,980 tax returns for the 2010/11 tax year.

This number includes 3.86 million indivudals and trusts who submitted their tax returns by the deadline of 25 November last year, as well as provisional taxpayers who have until midnight on Tuesday 31 January 2012 to submit their returns electronically on Sars eFiling.

Source: Web site - SARS Varsha Singh 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.

Events XXIV Regional Tax Policy Seminar Santiago de Chile, Chile 24 to the 26 of January, 2012

The XXIV Regional Tax Policy Seminar organized by the Executive Secretariat of the Economic Commission for Latin America and the Caribbean (ECLAC) took place from the 24 to the 26 of January, 2012 in Santiago, Chile through the Latin American Institute of Economic and Social Planning (ILPES), with the support of the International Monetary Fund ( IMF), the World Bank, the Inter-American Development Bank and the Organization for the Economic Cooperation and Development (OECD), and the sponsorship of the Federal Ministry of Economic Cooperation and Development of Germany, BMZ, and the Finance Ministry of the Government of Chile.

Promoting Government Responsibility Through Cooperation 7 March 2012

Event under the aegis of Mr Baroin, Minister for the Economy, Finance and Industry, Mrs Pécresse, Minister for Budget, Public accounts and State Reform, Government Spokeperson, and Mrs Kosciusko-Morizet, Minister for the Ecology, Sustainable Development, Transportation and Housing.

How can Techinical assistance contribute to conceive and implement public policies that will support sustainable growth and meet social aspirations?

In three roundtables, the participants will share concrete experiences and exchange views in the area of institutional technical assistance in the relation to the administration’s responsibility and accountability to the citizen...web site programme / Register

Post of the Month January 23, 2012

Algunos Cambios más. Written by: Raúl Zambrano

January 13, 2012

Consecuencias Tributarias de la Globalización. Written by: Jorge Cosulich

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Training Enrolment open for the Specialized Program on Tax Law and Tax Administration The Externado University of Colombia and CIAT within their cooperation agreement are inviting all Tax Administrations officials of the CIAT member countries, as well as the general public, to participate in the Specialized Program on Tax Law and Tax Administration. In order to participate, a registration form must be filled out and send to capacitacion@ciat. org indicating the name of the specialized program and the rest of the requirements. Registration forms will be received until May 4th, 2012....Tax Law and Tax Administration CIAT Courses registration call Given the importance of offering a permanent training that keeps the tax professionals up to date with the issues of tax administration, customs and transfer pricing, we announced that we have opened the registration for the following courses: • • • •

Course on Control of Institutions and Financial Operations 6ed.

Basic course on Human Resources Course on Tax Ethics and Tax Citizenship 2nd edition.

Course on Transfer Pricing 5th edition.

To participate, please fill the inscription form and send it to capacitación@ciat.org indicating the name of the course with the other requirements.

New in The Web New edition of the CIAT / AEAT /IEF Tax Administration Review The edition No. 32 of the CIAT / AEAT / IEF Tax Administration Review is already available for all members of MiCiat Community.

The publication presents seven (7) articles that explore various aspects of policy and tax administration and customs management in Latin America. Again thank you very much to all our disinterested authors for their valuable contributions.

Our documents CIAT Thematic Tax Series December 2011. No.18

This thematic series presents in its November 2011 6th edition the issue “Collection”. References compiled in this series are studies and works developed by technical public officers, as well as presentations developed during General Assemblies, Technical Conferences, Monographs, fellowships, and articles published in the “Revista de Administración Tributaria” among others.

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Bibliographic News January

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

Other Documents Elements for the discussion of a VAT reform in Colombia “Elements for the discussion of a VAT reform in Colombia” Javier Ávila Mahecha and Ángela Cruz Lasso Subdirección de Gestión de Análisis Operacional. DIAN Documento Web 046 January 2012

Since the beginning of this century, Colombia has tried to simplify its Value Added Tax with a general formula which would enjoys a relative academic and technical consensus: “To enlarge the tax base and to reduce the dispersion of tariffs”. In spite of multiple projects of law that the national government has presented in this purpose, a true simplification of the tax has not been reached, reason for which the issue continues to be present in the public policy agenda of the country.

This document presents the main characteristics of the VAT in Colombia, measure the tax expenditure of its preferential treatments and suggests possible reforms to its present design.

Fiscal Implications of Climate Change

Benjamin Jones, Michael Keen and Jon Strand The World Bank . Development Research GroupEnvironment and Energy Team January 2012 WPS5956Public This paper provides a primer on the fiscal implications of climate change, in particular the policies for responding to it. Many of the complicated challenges that arise in limiting climate change (through greenhouse gas emissions mitigation), and in dealing with the effects that remain (through adaptation to climate change impacts), are of a fiscal nature.