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eCIAT

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ISSN 1684-9833 • Year 3 / No.6 / March 30, 2012

The Executive Secretariat Informs

46th CIAT General Assembly The Executive Secretariat Informs The Tax Administrations of 40 countries meet in Chile CIAT Executive Secretary invited as speaker to UN ECOSOC meeting CIAT provides support to TAJ on exchange of tax information issues, in coordination with the Global Forum, the World Bank, the US IRS and the Guardia di Finanza of Italy CIAT Technical Assistance Director participates in Seminar at the Central American Institute for Fiscal Studies – ICEFI The Tax Administrations Inform Brazil - Secretariat of the Federal Revenue of Brazil (RFB) and Court of Justice of Espírito Santo materialize the use of the infojud system Chile - Tax collection totaled U.S. $ 41,600 million in 2011 and it is a historical record Chile - The SII provides 1.9 million Proposed tax returns Dominican Republic - Internal Revenue Launches Tax Education Campaign El Salvador - The Minister of Finance presented the financial report of the State for 2011.

Guatemala - The new Superintendent of the Tax Administration (SAT) was sworn Peru - The SUNAT presented the 2011 Campaign on Income Tax Returns Peru - The SUNAT implemented guidance and control actions to face illegal mining IBFD News Events Post of the Month Training New in the Web Other Documents

The Tax Administrations of 40 countries meet in Chile •

•

The central topic of the 46th General Assembly of the InterAmerican Center of Tax Administrations (CIAT) is: “Improving the performance of the tax administration: evasion control and taxpayer assistance.”

This is the third time Chile hosts the annual Assembly.

Chile and the Internal Revenue Service (SII), will host the 46th General Assembly of the Inter-American Center of Tax Administrations (CIAT) to be held on April 23 and 26 at the Sheraton Hotel in Santiago.

Delegates from 40 member countries and associates to CIAT, as well as representatives from multilateral agencies such as the Organization for Economic Cooperation and Development (OECD), the International Monetary Fund (IMF), the Inter-American Development Bank (IDB) and the Economic Commission for Latin America (ECLAC) will participate.

Some of the confirmed participants are Jeffrey Owens, former Director of the Tax Policy and Administration Center of the OECD, Beatriz Miguel Viana, General Director of the State Tax Agency of Spain (AEAT), José Antonio Azevedo Pereira, Director General of Taxes of Portugal.

The event represents an important challenge to the SII, for both the quantity and quality of countries and delegates participating.

According to the SII Director, Julio Pereira, “this is a global event, which shows the annual progress and best practices in tax administrations, produces cooperation and collaboration agreements, while we will show the organizational ability as the host country.”

The SII has already developed and made available the website of the Assembly, to which delegates can access the agenda to review technical and general details of the meeting in Santiago.

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CIAT Executive Secretary invited as speaker to UN ECOSOC meeting 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 UN Economic and Social Council held, on 15 March 2012, a one-day special meeting to consider the question of international cooperation in tax matters, including institutional arrangements to promote such cooperation.

Mr. Márcio Verdi, Executive Secretary, Inter-American Centre of Tax Administrations (CIAT), outlined CIAT’s activities aimed at enhancing cooperation, including through exchange of experiences and best practices among its 40 member countries, with a view to strengthening their tax administrations. He also reported on CIAT’s cooperation with other multilateral organizations and recent joint initiatives that resulted in an eff ective coordination of eff orts. Mr. Verdi stressed that such coordination required additional efforts to optimize the use of resources and minimize the costs. The speaker called on the UN Committee to involve, to a greater extent, regional tax organizations in its work.

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Phone (507) 265-2766 / 265-5994 Fax: (507) 264-4926 E mail:ciat@ciat.org Web Site: http://www.ciat.org Picture of the participants attending the International Tax Cooperation

CIAT provides support to TAJ on exchange of tax information issues, in coordination with the Global Forum, the World Bank, the US IRS and the Guardia di Finanza of Italy From March 13 to 16 of this year, experts from various fields met in Kingston, for advising the Tax Administration of Jamaica (TAJ) in the design and implementation of processes to exchange information to fight tax evasion and tax fraud effectively and according to international standards.

Due to the interest of the Jamaican authorities to improve their level of transparency, their Tax Administration has proposed a comprehensive reform, which among other relevant aspects, provides for the strengthening of their sources of information and their ability to effectively exchange information. As a proof of this, they have joined the Global Forum on Transparency and Exchange of Information.

The tax authorities of Jamaica have also raised the possibility of improving and expanding their network of information exchange tools and use these tools to efficiently fight fraud and tax evasion in Jamaica.

Photo: Ms. Lucia Torrejón and Mr. Cesar Perez from the IEF, with the CEF team of the SRI of Ecuador

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In order to support the aforementioned processes of change considered by the TAJ, the CIAT has conducted multilateral coordination tasks, in line with the recommendations of various international forums (G20, Task Force, ITC, ITD, etc..), which resulted in the co-sponsorship and support of prestigious organizations such as the World Bank, the Global Forum, the Guardia di Finanza of Italy and the US Internal Revenue Service (IRS).

The event was inaugurated on March 13, 2012 with remarks from the Honourable Dr. Peter Phillips, Minister of Finance and Planning of Jamaica, Mrs. Rosalee Brown, Deputy Commissioner General of Operations of the TAJ, Mr. Dave Jeffery, Large Taxpayers Office General Manager and Mr. Socorro Velazquez, CIAT Institutional Planning and Development Director.

Among the attending experts were Gonzalo Arias (CIAT), Bryan Welsh, (World Bank), Caroline Malcolm (Global Forum), Raul Pertierra (IRS) and Stefano Gesuelli (Guardia di Finanza). On the part of TAJ, officials from various areas involved in the process of exchange of information at the international level have participated and have presented in detail both the current situation on how information is exchanged at the international level, and their plans to improve the processes and achieve the desired effectiveness.

The activity has been very useful in order to adjust and reformulate aspects of the improvement plan proposed by the TAJ, and to make the TAJ aware of potential risks and actions to be taken as a result of its implementation.

It was noted that the TAJ has highly effective, clear and precise objectives to achieve effective information exchange, by which experts consider that it will not be difficult for the TAJ to achieve this goal.

Group of instructors and TAJ officials who attended the event.

From left to right, Mr. Gonzalo Arias, CIAT International Taxation and Cooperation Director, and Dave Jeffery, Large Taxpayers Office General Manager

De izquierda a derecha, Honorable Dr. Peter Phillips, Ministro de Finanzas y Planificaci贸n de Jamaica; Sr. Socorro Velazquez, Director de Planificaci贸n y Desarrollo Institucional y la Sra. Rosalee Brown, Comisionada General Adjunta de Operaciones

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The Tax Administrations Inform Brazil - Secretariat of the Federal Revenue of Brazil (RFB) and Court of Justice of Espírito Santo materialize the use of the infojud system With the e-Process, or SPED / Electronic Invoice and the Program Generator of income tax statement, the RFB The information system of the judiciary - Infojud (in Portuguese) allows judges and officials years previously registered by the digital certificate, access to the registered and economic-fiscal information from the database of the Revenue Secretariat of Brazil - RFB. The agreement signed in 2007 between the RFB and the National Council of Justice - CNJ, with the addition of the Court of Justice of the Espírito Santo – TJES, was consolidated on March 7, at a meeting with the presence of representatives of the RFB Police in Victoria, the President of that Court, Judge Pedro Rosa, and several other judges.

According to prosecutors, the Infojud will contribute to the effectiveness of tax enforcement since the taxpayers data may be accessed online, replacing the existing one, which is to request data via the RFB offices.

From May 1st, all requests for tax information included in the database of the RFB may only be on-line. For this, the TJES issued a normative act regulating access and accreditation of judges through the registration system Renajud.

According to the delegate of the RFB in Vitoria, Luiz Antonio Bosser, the implementation of the agreement will make justice in a fast and safe manner and give a better use to human resources, material and financial resources to all parties.

Representatives of the RFB Police in Victoria, the President of that Court, Judge Pedro Rosa, and several other judges.

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Chile - Tax collection totaled U.S. $ 41,600 million in 2011 and it is a historical record The combination of positive factors made it possible for tax collection in 2011 to record the most historic amount, totaling more than $ 21.5 trillion pesos (U.S. $ 41,600 million), for an increase of 16% over the previous year announced today the Internal Revenue Service of Chile (SII).

Mr. Julio Pereira, SII Director, explained that indeed, conducting more control processes by taxpayer segments, obtaining a 14% yield higher than 2010, the strong growth of economic activity (6%), the increase of the copper price (17.1%), the highest rate of monthly provisional payments (PPM) from taxpayers (17.6%) and the tax measures approved to finance the reconstruction after the earthquake of 2010, were the reasons for the results of tax collection in 2011.

Bernardita Moraga Correspondent

Chile - The SII provides 1.9 million pProposed tax returns The 2012 Income Operation, which begins on Sunday, April 1, will offer about 1.9 million proposed total and partial tax returns for individuals, and includes as an important innovation that from today, taxpayers can access www.sii.cl to review their proposals to establish if the information included is consistent with the data that each taxpayer expects.

By incorporating this facility, it is projected to April 1, when the returns period formally begins, that the site www.sii.cl will have less traffic because people are clearer regarding the details of their proposed returns and may send them faster.

Source: Web site Bernardita Moraga Correspondent

Dominican Republic - Internal Revenue Launches Tax Education Campaign The General Directorate of Internal Revenue began the Tax Education campaign “The care of public property.” Since last Friday, a guiding team from the Tax Education Department developed a program of lectures for schools and colleges of Santo Domingo.

Under the slogan “Public Property, a benefit for all”, the DGII developed this campaign to students and teachers with the aim of creating awareness about the importance of the care of public property that are acquired with money from taxes paid by each citizen; therefore, they should be preserved as a common heritage.

Nieves Vargas Correspondent

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El Salvador - The Minister of Finance presented the financial report of the State for 2011.

On Thursday 22nd, the Minister of Finance, Mr. Carlos Caceres, together with the Deputy Minister of Finance, Roberto de Jesus Solorzano and the Deputy Minister of Revenue, Engineer Mauricio Guardado, presented to the Legislative Assembly the Financial Report of the State for the Fiscal year 2011.

The Minister of Finance informed that the financial and budget management in 2011 was based on the policies implemented by the Executive in order to overcome the challenges the country faces, among others: to strengthen and balance the public finance; mitigate the impact of the economic crisis, protect the income of the most vulnerable population.

Source: Web site Ram贸n P茅rez G贸mez Correspondent

Guatemala - The new Superintendent of the Tax Administration (SAT) was sworn To guarantee an efficient execution of the tax policy, it is necessary that the National Superintendency of Tax Administration (SUNAT) count on adequate management mechanisms and instruments, as well as a flexible organic structure that may respond to its strategic role as collection entity.

Thus, the SUNAT Strengthening Law was approved last December for providing tools to the Tax Administration to fight evasion and avoidance, contraband and illegal trafficking of goods, facilitate foreign trade, expand the tax base and improve collection by means of a fair and equitable system for the taxpayers.

Fuente: Sitio Web Clara Urteaga Correspondent

Peru - The SUNAT presented the 2011 Campaign on Income Tax Returns The The SUNAT presented the 2011 Campaign on Income Tax Returns, with the aim of informing about the facilities and services for taxpayers to comply by submitting their Annual Income Tax returns fast, safely and easy.

The event was attended by the Minister of Economy, Luis Miguel Castilla Rubio and the National Superintendent of Customs and Tax Administration, Tania Quispe Mansilla, and it took place at the new SUNAT Taxpayer Service Center (CSC) located in the district of Villa el Salvador, south of Lima.

Clara Urteaga Correspondent

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Peru - The SUNAT implemented guidance and control actions to face illegal mining The government enacted Legislative Decree No. 1103 establishing measures for control and monitoring in the distribution, transportation and marketing of chemicals that can be used in illegal mining, which must be executed by the SUNAT and other public organizations involved in this problem.

According to the SUNAT, the first action to be developed will be launching a campaign for small-scale miners located in the Madre de Dios region where the highest percentage of illegal gold mining in the country is located. The Tax Administration will provide information on the benefits and facilities to regularize their tax status.

Clara Urteaga 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.

Events CEE Vienna International Tax Law Summer School Institute for Austrian and International Tax Law at the WU, Vienna University of Economics and Business July 16 – July 20, 2012

Fulltime students from CEE countries are kindly invited to send us their application (in English, please) for our “CEE Vienna International Tax Law Summer School 2012”, which will be held from July 16 to 20, 2012. The course is being organized by the Institute for Austrian and International Tax Law of WU Vienna.

Professors and experienced research and teaching assistants are teaching on Double Tax Treaties and European Tax Law matters.

The 2012 Uckmar

visiting Research Scholarship in the International Tax Law The institute for Austrian and International Tax Law at WU is one of the world´s leading institute for research and teaching in the field of tax law. Each year we select ouststanding doctoral students and, to a minor extent, postgraduate research fellows from other distinguished universities who wish to visit the institute for periods from one month to the year as visiting research scholars.

The deadline for the application for the Uckmar visiting Research Scholarship in the International tax law is October 15, 2012.

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Post of the Month March 24, 2012

No permitas que te pesquen. Written by: Issel Perozo

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 Bibliographic News March, 2012

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

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Other Documents La Política Fiscal de Centroamérica en Tempos de Crisis.

The Fiscal Policy in Central America in time of Crisis” Instituto Centroamericano de Estudios Fiscales (ICEFI)2012.

By presenting its Second Central American Fiscal Policy Report, the ICEFI seeks to achieve three main objectives: first, make a balance of the main characteristics of fiscal policy over the last ten years, highlighting the effects of the great recession in the economies and tax revenues of the countries as well as the economic policy responses taken by governments. Second, analyze how the main components of fiscal policy affect equity, highlighting, in this case, the way social policy is an effective instrument to reduce inequalities. Third, the sustainability of fiscal policy supporting growth promotes equity and adapt to the changing conditions in the international environment.

It also requires reforms in the field of revenues, expenditures and transparency.

Equity and Fiscal Policy: The Income Distribution Effects of Taxation and Social Spending in Central America Rodrigo Cubero and Ivanna Vladkova Hollar IMF Working Paper IMF

How does fiscal policy fare in improving the underlying income distribution in Central America? We integrate the data from a number of existing tax and public expenditure studies for the countries in the region and find that the distributional effect of taxation is regressive but small.

Fiscal Policy and Debt Dynamics in Developing Countries Ethan Ilzetzki The World Bank Development Research Group Macroeconomics and Growth Team May 2011

The author incorporates debt dynamicsinto a fiscal vector autoregression model for a number of developing countries. Existing estimates of the effects of fiscal policy on growth use linear time-series methods, which may assess the effects of fiscal policy along a debtpath that is unsustainable.