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eCIAT

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ISSN 1684-9833 • Year 4 / No. 8 /May 17, 2013

The Executive Secretariat Informs 47th CIAT General Assembly With the sponsorship of the Federal Administration of Public Revenue (AFIP) of Argentina, held in Buenos Aires the 47th CIAT General Assembly with the central topic “International taxation aspects that affect management of the Tax Administration” Resolution of the 47th CIAT General Assembly The Executive Secretariat Informs

The event was attended by more than 30 delegations from CIAT member countries and associated member countries; 11 delegations of invited countries; and 28 delegations of international organizations and institutions related to the CIAT.

47th CIAT General Assembly 2013 CIAT Technical Conference Training seminar on tax information exchange ITC-CIAT-GIZ conclude the feasibility analysis of initiative “access to public information of tax interest” CIAT and ITC-GIZ start field work in their joint project International Tax Community gathered in Buenos Aires to discuss Transfer Pricing Treatment The Tax Administrations Inform Argentina – Echegaray presented fiscal dialogue, the AFIP journal Argentina – Macedonia signed a tax agreement Bolivarian Republic of Venezuela - The SENIAT collects Bs 78.1 billion during the first four months of 2013 Brazil– The Federal Revenue exports Tax Education technology Canada – Harper Government announces new measures to crack down on international tax evasion and aggressive tax avoidance Costa Rica – The Ministry of Finance offers a Web site on international accounting standards Dominican Republic - Internal Revenue creates mechanisms for facilitating refunds to individuals Panama – Luis Cucalon is the new National Tax Administrator Paraguay – Total tax collection increased 14% in April Paraguay –Since May, a new group of taxpayers will be withholding agents Interview IBFD News Training Post of the Month New on Web Other Documents

2013 CIAT Technical Conference The 2013 CIAT Technical Conference will take place in Nairobi, Kenya, on September 9 to 12 under the sponsorship of the Kenya Revenue Authority (KRA).

The main topic, already defined and approved by the General Assembly in April 2012 in Santiago, Chile, will be “PREVENTION AND CONTROL OF TAX EVASION”.

During the CIAT General Assembly recently held in Buenos Aires, Argentina, Mr John Nijraini, General Commissioner of the KRA, and the CIAT Executive Secretary have coordinated the final technical and logistic details of the event.

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CIAT is a public international organization which groups the tax administrations of 39 countries, (31 Amarican countries, 5 European countries, 2 African countries and 1 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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ITC-CIAT-GIZ conclude the feasibility analysis of initiative “access to public information of tax interest” As a result of the work performed by GIZ and CIAT within the “Regional Program” framework on large companies taxation and transfer pricing which was initiated in 2008

by InWent and is currently led by GIZ, there has been progresses in the discussion of initiatives that derive in tangible results for the tax administrations in Latin America. Unanimously, the tax administrations represented at the meeting held in Lima in November 2011, stressed the need to access public information and ideas on how to deal with an initiative of this nature.

For the purpose of moving forward with this initiative and determine its feasibility, ITC provided funds that allowed elaborating the document promoted in the present newsletter, and carrying out a working group meeting with CIAT member countries of Latin America which took place in Montevideo in 2012, and a meeting with the working team that was held in Panama in 2013.

The need to access public information for tax matters has been expressed by CIAT member countries tax administrations in recent years. To have access to and exchange between states public information on tax matters through efficient mechanisms not only help to comply with essential requirements for achieving tax information exchange standards, as well as the subsidiarity principle which implies to exhaust all available resources before processing a formal request for information subject to tax secrecy, but it also contributes to the reduction of transactional costs of tax administrations in their collection of information from abroad. Even more, considering that much of the public information is available on the Internet, or electronic media. In addition, the absence of restrictions on the dissemination of this information does not require controls on its use, greatly helping the selection and verification process of taxpayers.

The next step consists in defining an action plan that will allow implementing a mechanism to share public information.

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

“For additional information please contact Mr. Gonzalo Arias, CIAT Director of International Taxation and Cooperation.

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Training seminar on tax information exchange As a result of multilateral efforts of the Secretariat of Federal Revenues of Brazil, ESAF, the World Bank, the Global Forum on Transparency and Information Exchange, OECD and CIAT, a seminar was held in Brasilia on May 7 through 10, which purpose was to exchange experiences and provide knowledge regarding the main processes and challenges in effective tax information exchange.

This activity involved a panel of specialists formed by officials from the Global Forum on Transparency and Information Exchange, the Guardia di Finanza of Italy, DGI of Panama, the Secretariat of Federal Revenues of Brazil, HMRC from the United Kingdom, OECD, the World Bank and CIAT. Also present were officials from different areas of the Secretariat of Federal Revenues of Brazil and tax administration officials from Argentina, Colombia, Costa Rica, Dominican Republic, El Salvador, Paraguay and Uruguay.

The four-day sessions were devoted to discussing legal aspects regarding international standards for information exchange, procedural aspects and other aspects of current importance such as FATCA and matters related to the “Oslo Dialogue�. In addition, practical exercises were carried out regarding the design of administrative manuals for information exchange and the formulation of information requests based on a model agreement.

Left opening table: Renata Fontana, Global Forum on Tax Transparency and Exchange of Information; Alexandre Riveiro Motta, ESAF; Carlos Alberto Freitas Barreto, Receita Federal do Brasil; Brian Welsh, World Bank and Gonzalo Arias, CIAT

Official photo of the event

Event participants

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CIAT and ITC-GIZ start field work in their joint project As a part of the cooperation program between the American Center of Tax Administrations (CIAT) and the International Tax Compact (ITC) - Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), a field work to measure the social acceptance of tax noncompliance in Latin America has been launched.

This sociological study seeks to find out the citizens ‘opinions regarding the tax non-compliance phenomenon, specifically in two (2) selected pilot countries, Panama and Bolivia. Following public opinion polling techniques, it is expected to determine the extent of the phenomenon and its possible determinants.

The renowned international market research company IPSOS has been hired by the CIAT to conduct surveys in these two pilot countries in April and May, following a questionnaire previously discussed with the tax authorities of these selected countries.

The project is implemented by the CIAT Directorate of Tax Studies and Research, with the participation of the international consultant María Goenaga Ruiz de Zuazu. The study results are expected to be presented in July. It is hoped that they will contribute to focus the tax authorities’ efforts to promote voluntary tax compliance.

For further information on technical assistance in this line of research, please email Miguel Pecho ( mpecho@ciat. orgThis e-mail address is being protected from spambots. You need JavaScript enabled to view it ), Director of Tax Studies and Research at the CIAT.

International Tax Community gathered in Buenos Aires to discuss Transfer Pricing Treatment A workshop sponsored by “International Tax Compact” (ITC), the World Bank - “International Finance Corporation”, USAID and CIAT was held on April 26, 2013 in Buenos Aires. Its main purpose was to promote the discussion among the different sectors of the international tax community of the main aspects regarding transfer pricing, from the normative as well as administrative standpoints.

A very dynamic methodology was adopted for discussing in the morning sessions the status of the Latin American and Caribbean countries, the vision of the private sector on the subject, experiences in the sphere of simplification and new developments in the treatment of intangibles and reorganization of businesses. Four parallel round tables were held in the afternoon to consider advance pricing arrangements (APAs), treatment of services, thin capitalization, information exchange and import/export of agricultural commodities.

Viewpoints and criteria were discussed among the different actors of the international tax community and alternate solutions were analyzed, thus resulting in the identification of best practices that would give way to future bilateral exchanges between the participating tax administrations.

The participation of experts from tax administrations of 19 CIAT member countries from the Americas, Caribbean, Africa, Asia and Europe, as well as international organizations and initiatives and leading cooperation agencies such as ITC, OECD, the World Bank, IFM, IBFD, GIZ, CIAT, the Technical Assistance Office of the U.S. Treasury and USAID, in addition to representatives from Alstom Group, Ernst & Young and IFA allowed for holding fruitful discussions and ensuring the success of this joint initiative.

Participants photo

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The Tax Administrations Inform Argentina – Echegaray presented fiscal dialogue, the AFIP journal Before announcing the collection record for April, the federal administrator of public revenues Ricardo Echegaray, presented a new communication channel between the Treasury and taxpayers: fiscal dialogue, the AFIP journal. “It is an agile, dynamic and mainly modern and interactive platform,”.

Carlos Alberto Sánchez Correspondent

Argentina – Macedonia signed a tax agreement .

The federal administrator of public revenues Ricardo Echegaray, on behalf of Argentina, signed an agreement for the exchange of tax information with the vice Prime Minister of the Republic of Macedonia, Zoran Stavreski.

Carlos Alberto Sánchez Correspondent

Bolivarian Republic of Venezuela – The SENIAT collects Bs 78.1 billion during the first four months of 2013 The National Integrated Customs and Tax Administration (SENIAT) collected a total amount of 78.1 billion bolivars during the first four months of this year, representing a 127 percent compliance with the target of 61.5 billion bolivars set for this period.

The information was provided by the National Customs and Tax Superintendent Jose David Cabello Rondon, after totaling the collection by the National Treasury during this period, according to calculations by the Bureau of Statistics and Tax and Customs Economic Studies of the collection agency.

Pablo Pinto Chávez Correspondent

Brazil – The total of personal income tax returns is under the Federal Revenue’s provisions In an interview the same day (30), the Secretary-General Carlos Alberto Barreto qualify as “very positive” the numbers from this year on the personal income tax, saying that it could be attributed to the successful “good” behavior of the Serpro computing systems that worked flawlessly.

According to Barreto, the amount of returns sent in recent days was due to the facilities that are offered, with which “the taxpayer became more confident in the programs”. Only on the last day 3.399.665 taxpayers filed their returns, which show the processing capacity of the systems.

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Tablets The Secretary was also satisfied with the results of the innovations implemented by the RFB which facilitated the submission of returns - via Tablet and Smartphone. Even if this year, only 7.361 taxpayers used this tool to file their returns, he mentioned that this was under the previsions considering that this is the first year of this new development.

He stated that this number will be much higher in 2014. As for the new system to file pre-filled returns performed by the Receita, where the taxpayer receives a pre-filled return with the return data and further information from the RF, Berreto reported that the Agency is working hard in this direction; he didn’t confirm its implementation for next year.

The PIR national supervisor Joaquin Adir, the Cotec’s coordinator general Cláudia Andrade, and the President of Serpro Marcos Mazoni participated at the final IRP’s 2013 meeting.

The PIR national supervisor Joaquin Adir, the Cotec’s coordinator general Cláudia Andrade, and the President of Serpro Marcos Mazoni participated at the final IRP’s 2013 meeting

Canada – Harper Government announces new measures to crack down on international tax evasion and aggressive tax avoidance The Honourable Gail Shea, Minister of National Revenue and Minister for the Atlantic Canada Opportunities Agency and the Honourable Maxime Bernier, Minister of State (Small Business and Tourism), today announced new measures to combat international tax evasion and aggressive tax avoidance, including a $30-million investment by the Harper Government and the creation of a dedicated team to implement measures from Economic Action Plan 2013.

Maria Pica Correspondent

Costa Rica – The Ministry of Finance offers a Web site on international accounting standards April 29, the National Accounting of the Ministry of finance, has the NICSP site, available for accountants of the Costa Rican Public Sector, in order to support and make them progress more efficient and effectively in their work towards the implementation of international accounting standards for the Public Sector (NICSP) and the international standards of financial reporting (IFRS/IAS) for public companies.

Maribel Zúñiga Cambronero Correspondent

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Dominican Republic – Internal Revenue creates mechanisms for facilitating refunds to individuals The Directorate General of Internal Revenue DGII announced the creation of a mechanism to facilitate tax refunds to individuals and workers. It consists in a bank account with RD $ 10.0 million pesos within the Special Fund for Tax Reimbursements managed by the Internal Revenue by Law No. 227-06 which will enable the Tax Administration to respond more effectively to refund claims from employees and individuals with income tax credit balances.

Nieves Vargas Collado Correspondent

Panama – Luis Cucalon is the new National Tax Administrator President Ricardo Martinelli appointed Mr Luis Cucalon U. as the Administrator of the new National Public Revenue Authority, and submitted to the National Assembly his ratification.

By Executive Decree 531 of May 9, 2013, Martinelli selected Cucalon to lead the National Public Revenue Authority, replacing the former Revenue General Directorate, which was part of the Ministry of Economy and Finances.

Paraguay – Total tax collection increased 14% in April The total tax amount collected by the Taxation Sub-Secretariat (SET) and the National Customs Directorate (DNA) was 1.413 billion guaranies in April, which represents an increase of 14% (G. 175,000 million additional) compared with this same month in 2012, which reached G. 1.238 billions).

Elizabeth Fernández de Corrales Correspondent

Paraguay – Since May, a new group of taxpayers will be withholding agents From May 1st, 2013, a new group of taxpayers of the State Taxation Sub-Secretariat will become withholding and information agents for the Value Added Tax (IVA).

Elizabeth Fernández de Corrales Correspondent

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Interview The Inter-American Center for Tax Administrations (CIAT) will develop Courses at the EVM Interview to Mr. Marcio F. Verdi MERCOSUR Virtual School March, 201

By an Agreement signed between both institutions.

Mr. Marcio Ferreira Verdi, CIAT executive Secretary, explains the characteristics of the agreement, the courses and the CIAT experience in virtual tax training.

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.

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: • • • •

Tax Ethics Course 3rd.

Course on Information Exchange.

Course on General Principles of Public Finances and Tax System.

Accreditation – Diploma in Taxation.

If you are interested in participating, please fill out the registration form.

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Post of the Month Tuesday, May 7, 2013

When public services stop being offered for “free” Written by María Goenaga Ruiz de Zuazu The Tax barometer data from the Tax Studies Institute, as well as the Public opinion and Tax policy Sociological Research Center, which are the only two sources that measure tax awareness of Spanish, for years has supported that universal health care is the main justification to pay taxes in Spain. But there were many other services and benefits that were acknowledged and used by taxpayers, available when needed.

Tuesday, May 07, 2013

Taxation and Wikipedia Written by Andre Georges Dumoulin Wikipedia is now the most widely used source of documentation in the world, with more than 4,200,000 articles in English and more than 980,000 articles in Spanish, and thousands of articles are dealing with taxation, such as taxation by countries, types of taxes, history of taxation, customs and more. The content is often available in various languages but not always. So the differences between languages are a source of information. Taxation proceeds from this second category. It changes with the countries.

Wednesday, 24 April

Dancing tango in the digital economy Written by Raul Zambrano In times of Web 2.0, of tablets and Smartphones, of applications, social networks, Internet, platforms and services, and the electronic tango; we find ever more complex challenges for which, it seems, the existing rules are simply not enough.

New on Web Income and Capital Gains Taxation, and Financial Institutions Tax Treatment and Control in Latin America ITC/GIZ/CIAT No.1, April. 2013 (Spanish only)

As part of the Partnership ITC / GIZ / CIAT for the Development of Tax Administrations in Latin America and the Caribbean, CIAT collected information, updated to 2012 on the taxation of income and capital gains and the tax treatment and control of financial institutions in Latin America. Eleven (11) countries were considered: Argentina, Brazil, Chile, Colombia, Ecuador, Mexico, Panama, Peru, Dominican Republic, Uruguay and Venezuela.

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Other Documents World Economic Outlook (WEO) Hopes, Realities, and Risks International Monetary Fund April 2013

Global economic prospects have improved again, but the bumpy recovery and skewed macroeconomic policy mix in advanced economies are complicating policymaking in emerging market economies. Chapter 3 examines the prospects for inflation, particularly because inflation was remarkably stable in the wake of the Great Recession and, in fact, has become less responsive to cyclical conditions. Chapter 4 examines whether today’s fast-growing, dynamic low-income countries are likely to maintain their momentum and avoid the reversals that afflicted many such countries in the past.

Gaceta Fiscal Centroamericana Central American tax Gazette

Instituto Centroamericano de Estudios Fiscales Central American Institute for fiscal studies Year 1, No. 3, April 2013 (Spanish only) With the aim to keep the Centro American society up-to-date with the most relevant monthly events related to taxation, the Icefi presents its Central American tax Gazette newsletter.

In this edition Icefi addresses the Summit of the Central American integration System (SICA) analyzing the implications of this meeting in the region, which should be taken as a first approach of what appears to be a new political era between the isthmus and this country.