Y5n21

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ISSN 1684-9833 • Year 5 / No. 21 / November 29, 2013

The Executive Secretariat Informs The Executive Secretariat Informs

Sixth Meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes Workshop “Environmental accounts and environmental tax reform” The II EUROsociAL program sponsors visit on “Tax Information Exchange Units and Procedures” based on the Argentina-AFIP experience

Sixth Meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes This November 21 to 22, 2013, the CIAT Executive Secretary Mr. Marcio Verdi participated to the Sixth Meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes which took place in Jakarta, Indonesia.

The Global Forum brings together 121 countries and jurisdictions for wide-ranging discussions on transparency and exchange of information. Its sixth meeting attracted more than 200 delegates from 86 member jurisdictions and 11 international organizations. During the Jakarta meeting, six new countries became members: Azerbaijan, Dominican Republic, Lesotho, Romania, Senegal and Ukraine.

The Tax Administrations Inform

The following measures were adopted during this meeting

Brazil - The Federal Revenue Celebrates 45 years Brazil - Hosts an international forum to discuss tax and customs issues Chile - Hearn about the new Electronic Invoicing menu Colombia - National agreement against illegal business practices Dominican Republic - Guarocuya Felix states that human resources is the most important asset in the DGII El Salvador – The Ministry of Finance launches new online services to facilitate procedures to citizens Honduras - The DEI authorities presented proposals for the 2014 2017 Strategic Plan Paraguay - Debate on double taxation of income tax

Actions taken include:

IBFD News Training Post of the Month New in the web Other Documents of interest

Publication of new compliance ratings for 50 countries and jurisdictions on practical implementation of the Global Forum’s information exchange standard. Eighteen jurisdictions are rated Compliant, 26 jurisdictions are rated Largely Compliant , two jurisdictions are rated Partially Compliant and four jurisdictions are rated Non-Compliant .

Fourteen additional jurisdictions were not given compliance ratings, pending further improvements to their legal and regulatory frameworks for exchange of information in tax matters.

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Establishment of a new Automatic Exchange of Information (AEOI) Group, open to all interested countries and jurisdictions, to prepare the move towards AEOI implementation. Italy was elected chair of this group.

Agreement for further work aimed at strengthening the definition of beneficial ownership and the availability of this type of information.

Agreement that the Forum continue monitoring implementation of the transparency and information exchange standard, while further developing its Terms of Reference and review processes.

We invite you to CIATalks, the space provided by CIAT. Read the posts, give your opinion and actively participate

The Global Forum will enhance its technical assistance work to address the needs of all its members and will host the third meeting of the Competent Authorities in October 2014.

Source: OECD note

Workshop “Environmental accounts and environmental tax reform�

CIAT is a public international organization which groups the tax administrations of 38 countries, (31 Amarican countries, 5 European countries, 1 African countries and 1 Asian country. India is an associate members), 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

The German Cooperation Agency GIZ, in collaboration with the Ministry of Finance and the Deputy Minister of Internal Administration and Systems Development of Guatemala, carried out on November 18 in Antigua, Guatemala, a workshop on Environmental Accounts and Environmental Tax Reform, based on the experience of Guatemala, which is one of the first countries in Latin America that has implemented them.

Officials of international organizations such as the World Bank and the Central American Institute for Fiscal Studies - ICEFI, participated in the workshop together with national institutions such as the Research and Social Studies Association - ASIES, the Planning and programming Secretariat of the Presidency - SEGEPLAN, the Ministry of Energy, Ministry of the environment, the Comptroller-General of Guatemala, and other national institutions of Guatemala.

Mr. Joerg Wisner, current Chief of the German mission at CIAT, and Ms. Zoraya Miranda, Technical Assistant of the Tax Studies and Research Directorate participated on behalf of the Inter-American Center of Tax Administrations - CIAT. The first day of the workshop started with the introductory topic on Environmental Accounts by Mr. Dr. Martin Nowack, collaborator of the German GIZ , who explained about the GDP as an indicator for the growth of the national economy. He emphasized that no one talks about a green GDP that contributes to the well-being of societies that believe in the future of their children. If only the traditional GDP is taken into account, we may reach false conclusions not suitable for the environment. In addition, he referred to an existing project in India and Peru on environmental accounts, as well as a GIZ project within the group in Rio + 20 frameworks.

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Another issue that is worth mentioning is the so-called “the environmental footprint “, which was presented

by Mr. Alejandro Callejas from México. Mr. Callejas explained its importance and impact on the economy of a country. This transforms it into an essential element to determine how stable the economy and the tax burden capacity needed can be to maintain the economy.

On the other hand, a representative of the World Bank presented, via online Conference, the Wealth Accounting and Valuation of Ecosystem Services - Waves program, which has resources to be used in Latin American countries, as it is the case of Peru and Costa Rica.

In the evening a discussion group called “Talk Show” and the method “Fishbowl” took place, in which participants and experts discussed the main topic, based on their experience, reaching the conclusion that environmental accounts are extremely important because they measure environmental existing assets, allowing to know how the economy invests in the environment, how natural resources should be protected, and what is the interaction between the environment and the economy of a specific region, or the entire surface of a given country.

Then the researcher Jaime Luis Carrera, of the Rafael Landívar University in Guatemala, spoke about the Integrated Environmental Accounting System, highlighting its importance to measure the economy through market prices and production costs. He stressed that one of the most comprehensive view of the economy, which is not integrated into environmental accounts, is through the depletion of natural capital and environmental degradation. He also mentioned the aspect on the chain of impact, the incidence, and political action; i.e., how the consequences of the production are related to the goods and what is the public impact to the society. The goal is to improve the relationship between economy and environment. He explained the National Accounts System-SCN of Guatemala, through which an analysis of the economic activities and the environment can be performed, thus allowing a link between accounts and environment.

Additionally, Dr. Leiner Vargas, speaker from Costa Rica and former ECLAC consultant also participated and stated that his country took the following priorities: 1. The decision of the State on how much to spend on the environment (public budget); 2. The provision of tax expenditure, including green exemptions; 3. Prioritization of sectors, as for example the agriculture sector.

He ended his presentation by pointing out that this country decided to tax coal, in order to promote renewable energy. He also said that another priority sector is public transport, since 70% of the population uses public transport. This means that measures in favor of public transport must be taken.

Undoubtedly, the main objective of these topics is the implementation and execution of an environmental fiscal reform, not only for the conservation of natural resources of a country, but for the improvement of the quality of life of their inhabitants and future generations, and this is just the beginning of a long road.

Group photo

Participants

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The II EUROsociAL program sponsors visit on “Tax Information Exchange Units and Procedures” based on the Argentina-AFIP experience .

A “South-South exchange” visit about units and procedures for the exchange of tax information was held on November 12 to 15, 2013 in the city of Buenos Aires, mainly based on the experience capitalized over the years by the Federal Administration of public income of Argentina (AFIP).

Officials from the tax administrations of Bolivia, Brazil, Chile, Guatemala and Peru, who actively participated in the discussions and presented their experiences in different aspects of the program, took part in the visit.

Among the issues discussed were the TIEAs negotiation processes, the management and the modalities for the information exchange, the tax and customs agreements network, the legal framework and instruments for the Exchange and the use of public information, among others. The CIAT also presented its Project on the availability of tax-related public information in Latin American countries.

The participants were able to analyze critical processes that have affected both the AFIP and other tax administrations regarding the exchange of information (national and international) and consider the key factors of success and the possibility of implementing them in their Administration; they also analyzed the possible uses given to the information received from other administrations, facilitating and contributing to tax compliance.

The visit was a result of the demands that beneficiary countries presented to the II EUROsociAL program, within the framework of the Action “Compliance with tax obligations” of the “Public Finance area” coordinated by the FIIAPP, in operational partnership with the AEAT, the IEF of Spain and the CIAT. From now on, the CIAT along with members of the EUROsociAL II program will follow up the progresses, requests and issues presented by the tax administrations beneficiaries of the program, with the purpose to move forward on new activities in support of voluntary compliance.

Participants

Speaker: Gonzalo Arias, CIAT’s Director of Cooperation and International Taxation

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The Tax Administrations Inform

Brazil - The Federal Revenue Celebrates 45 years The Federal Revenues celebrates this Tuesday, November 20, 45 years of existence. The date is also marked by the launch of the official Twitter account of the Federal Revenue, this is one more communication tool that aims to give more transparency and agility to the dissemination of information of public interest. According to the Secretary Carlos Alberto Freitas Barreto, the initiative is an additional measure to the reformulation of the institution’s Web site, the creation of a video channel on You Tube and the “ Armored Border “, a page on the internet through which citizens can follow the news about the actions against smuggling and piracy. “It is vital for the Federal Revenue to continuously redefine its interaction and communication channels with society”, said the General Secretary.

In 1968, the Federal Revenue emerged from the unification of several tax agencies, replacing the former Directorate General of the National Treasury. In 1971, the headquarters was moved from Rio de Janeiro to Brasilia.

Among the mayor tasks of the Treasury are collection, auditing, tax and customs control. In recent years the Agency has been promoting a greater integration with taxpayers, facilitating voluntary compliance with tax obligations and access to personal information for interest of every citizen, through the intensive use of technological solutions available to society.

Brazil hosts an international forum to discuss tax and customs issues .

From November 4 to 8, Brazil hosted the IBAS Forum meetings, which included the heads of the administration of the tax and customs areas of India, Brazil and South Africa. Representatives from Russia, the Organization for the economic cooperation and development (OECD), the world Organization of Customs (WCO) and the Inter-American Center of tax administrations (CIAT) also participated in the meetings as guests.

The event, organized by the Federal Revenue, was held in Rio de Janeiro and was attended by the Secretary Carlos Alberto Freitas Barreto.

The working groups discussed proposals for mutual cooperation on issues such as control, international taxation, transfer pricing, information exchange, risk analysis, technical research, customs connectivity, training, non-tariff barriers, among others.

At the meeting on Wednesday, there was a special agenda, for topics on tax and customs cooperation as, for example, the fight against the erosion of the tax base, the question of the transfer of profits, formation of views that converge in multilateral forums and automatic exchange of tax and customs information. These schedules include BRIC/WCO/OECD projects.

IBAS is a privileged forum, formed by 16 working groups for specific initiatives of trilateral cooperation between India, Brazil and South Africa, in the areas of agriculture, science and technology, the fight against hunger and poverty, trade, taxes, energy, health and transport, aimed at giving a new impetus to South-South cooperation.

During the event were also discussed and approved reports concerning the trilateral work plans for the period 2012 / 2013, as well as for the period 2013 / 2014.

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Chile - Learn about the new Electronic Invoicing menu The internal revenue service is currently implementing various actions that will contribute to spread the use of electronic invoicing. One of them is the new structure that the SII gave to this tool’s menu, for facilitating the registration and issuance of these documents.

With this purpose, we have redesigned the electronic invoice menu of our website www.sii.cl, both for existing and future users, which will be added to this system once its mandatory use is approved.

Bernardita Moraga Correspondent

Colombia - National agreement against illegal business practices The Ministry of Finance and Public Credit, DIAN, the ITRC and the National Trade Union Council came together to strengthen the fight against illegal international trade.

The public and private sectors move forward against illegal practices in tax, customs and Exchange matters, the agreement was signed in the working group by the Minister of Finance Mauricio Cardenas; the Chairman of the National Union Council, Rafael Mejía López; the Director of the DIAN, Juan Ricardo Ortega and the Director of the Tax, Income and parafiscal contributions (ITRC) Control Agency, the General Controller, Carmen Maritza González Manrique.

Rubén Darío Pineda Correspondent

Dominican Republic - Guarocuya Felix states that human resources is the most important asset in the DGII The General Directorate of Internal Taxes (DGII) received a new public recognition for their good practices in the management of human resources, experience which was presented among the global trends in the fight against the corruption of the American Chamber of Commerce.

The Director General, Mr. Guarocuya Felix, spoke about the issue during the seminar “clear rules and strong institutions: no to corruption” which was organized by the Legal Committee of the American Chamber of Commerce (AMCHAMDR) with the participation of public and private sector personalities as panelists and speakers.

Nieves Vargas Collado Correspondent

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El Salvador – The Ministry of Finance launches new online services to facilitate procedures to citizens The Ministry of Finance, with the support of the Spanish Agency of International Cooperation for Development (AECID), reported that from December 1, 2013 new online services will be available using the website www.mh.gob.sv, with the purpose of supporting the taxpayers and citizens who perform procedures at the General Directorate of Internal Taxes (DGII).

Ramón Pérez Gómez Correspondent

Honduras - The DEI authorities presented proposals for the 2014 - 2017 Strategic Plan The Revenue Executive Directorate, aware of the prevailing demands of Honduran society, has proposed new and innovative planning and administrative management processes to ensure the operational continuity of its services and comprehensively respond to the collection demands.

The Strategic Plan is very important for the DEI, since it shows the need to raise the efficiency and effectiveness standards in the collection and control areas, and to adapt its action to the new demands of the income and expenditure budget.

Grace de La Paz Saravia Correspondent

Paraguay - Debate on double taxation of income tax The first meetings between representatives of the Secretariat of State of taxation of the Ministry of finance and the Spanish tax agency were hold, with the aim of beginning negotiations to avoid double taxation between our country and Spain.

At the opening of the Conference the Deputy Minister of the SET, Marta González Ayala; the Deputy Minister of economy and integration, Daniel Correa and the Ambassador of Spain in our country, Diego Bermejo Romero were present. SET Technical assistants were also present, as well as officials of the SEEI, of the Ministry of Foreign Affairs and representatives of the Spanish tax agency.

Elizabeth Fernández de Corrales 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.

Training As part of our commitment to support the human talent development within the TAs, we have started the registration process for the courses that begin in the first half of 2014, please find here the general information for each of the available programs.

Post of the Month 22 November 2013

This is a very small world Written by: RaĂşl Zambrano A comment posted by Antonio Seco in a previous blog invited us to remember the six degrees of separation theory, showing that the world is small and that everyone on the planet could connect anyone through friends of friends in a surprisingly small number of steps.

19 November 2013

Public Administration and the Meta-governance of hierarchies, Networks and Markets Written by: Andre Georges Dumoulin Broadly speaking, governance covers how the problems are tackled and opportunities created. This is about how, not what or why.

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New in the web Bibliographic News November, 2013

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

Other Documents of interest “Perspectivas Económicas de América Latina 2014: Logística y Competitividad para el Desarrollo” Economic Perspectives for Latin America 2014: logistics and competitiveness for development Economic Commission for Latin America and the Caribbean 2013

The report is a joint publication of the OECD Development Center, the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) and the CAF, Development Bank of Latin America. This edition includes a macroeconomic analysis of the region as well as the global context influence in the region’s economy (available in spanish).

Is the International Tax System Fit for Purpose, Especially for Developing Countries?

Sol Picciott International Centre for Tax and Development 2013

Taxes are a basis of national states, but they have been internationally coordinated since the emergence of taxes on income and profits, which were central to the legitimacy of taxation and the increased power of states in the 20th century.

Finance & Development Magazine Global Trade’s Uncertain Course International Monetary Fund December, 2013

Global trade remains an important and growing force in the world economy. Virtually every country on the planet now recognizes the role of trade in achieving higher economic growth and improved living standards.

In this issue of F&D, we look at the various forces affecting global trade today—some of which offer new opportunities for poorer countries to become part of the global factory, while others present barriers to negotiating future trade deals.

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