The Directorate General of Taxation has hired an external service that cross matches taxpayer data in public databases to identify suspicious patterns that might suggest misconduct.
The project called Predictive Model started to be implemented by the Ministry of Finance of Costa Rica this year, and aims to analyze the behavior of firms and individuals in order to identify suspicious or unusual patterns in the process of declaration of income and tax payments.
A declaration of unconstitutionality has been given to the section of the tax code that allowed the Treasury to demand payment of penalties and interest allegedly owed on taxes before the right to a defense can be exercised.
The slowness and inefficiency with which the Taxation department processes tax disputes, sometimes involving decades before there is a resolution, led to the outlandish idea on the part of lawmakers of putting the cart before the horse.In order to solve the problem of stubborn evasions where people take advantage of the inefficiency of the Taxation department, a decision was made to take away from companies the right to contest the results of tax audits, forcing the taxpayer to pay the amounts ordered by these audits, within in a deadline of one month, in order to be able to initiate formal questioning of those results.Now, the Supreme Court of Costa Rica has taken away that power from the Taxation department, declaring it unconstitutional.
Due to the implementation of a new tax system, the government has postponed until August 31 the deadline for filing tax declarations and reports which were due on July 31.
From a statement issued by the Ministry of Economy and Finance:
The Directorate General of Revenue (DGI) at the Ministry of Economy and Finance wishes to reiterate to all taxpayers that because of the implementation of the new tax information system e-Tax 2.0, official financial statements and reports that were due for submission on July 31 may be submitted until August 31, 2016.
Optimization of the DGI's management practices has been cited as the cause of the 14.3% increase in tax revenue collection in the first half of the year.
From a statement issued by the Ministry of Finance:
The collection of tax revenue for the first half of the year increased by 14.3% compared to the same period in 2015, according to the latest preliminary report released today by the Directorate General of Revenue (DGI) at the Ministry of Economy and Finance (MEF).
Presenting a tax declaration will be a requirement for some companies seeking bank loans.
The move is part of the Regulation on the Qualification of the Debtors, which has been in effect since June 17.The companies that will be asked for this requirement are those who "... have a good credit record, low currency risk in the event of abrupt changes in the dollar and have audited financial statements."
The Government is once again bringing to the table the concept of global income, to force tax residents in the country to declare and pay taxes on profits earned abroad.
The Ministry of Finance has announced that"... they are working on a substitute text to a reform of income tax, which would mean a profound change to the initiative which is in Congress."This proposal is for tax any income generated from commercial activities outside of Costa Rica, by those tax residents who stay at least 183 days a year in the country.
The amount paid to the Tax Authority corresponds to unpaid taxes, plus penalties and interest.
An article on Lahora.gt reports that the Superintendent of the SAT, Juan Francisco Solorzano, said that "... It is the largest payment made by any entity, in relation to adjustments that had been made or that had been ordered as a result of a judicial process from which it was ruled that there was tax fraud or tax evasion. "
Memorandum on the implementation of the rules on transfer pricing 2015 and payment schedule for obligations in January 2016.
From a Memorandum sent by Tezó and Associates:
Taxpayers who pay ISR (income tax) who carried out transactions in 2015 with related foreign companies, including imports, exports, services provided and received such as management services, legal, accounting, financial, technical or any other services; and where these operations had an impact on the determination of the income tax payable, are required to have a Transfer Pricing Study.
A proposal has been made to include new revenue figures, notify companies via email and to make audit processes simpler.
The bill that the Executive Directorate of Revenue has under public consultation envisages changes in the mechanisms through which requests are received or delivered as well as notices regarding tax payments. Laprensa.hn reports that "...
Before March 31, 2016 companies with related parties abroad must present a transfer pricing study.
Elperiodico.com.gt reports that "...Angela Paniagua, an auditor from the firm Ixcamparij Mejia y Asociados, explained that a lot of companies have not been notified that they must fulfill this obligation. The SAT only included a box in which they had to 'tick" if the company has operations abroad and asked for details for the tax administration database. There is lack of knowledge on the subject, because of, among other things, lack of disclosure of implications and a guide to the issues that must be reported to the SAT, said the auditor. "
On average in Costa Rica more than one in five companies classified as Large Taxpayers do not pay taxes.
When the Tax Department does not fully complete its duties, competition between companies is settled not by the quality of products or services, or for the excellence of its managerial staff and their strategic direction, but for the ability of their tax advisors to reduce the amount of taxes paid.
If your company imports, exports, provides services, receives services, or receives funding grants, among other things, with related companies located abroad, Special Valuation Rules Between Related Parties apply, as set out in Articles 54 to 67 of Decree No. 10-2012. Decree No. 19-2013 with effect from December 21, 2013, states that these rules are suspended in their application and effect! and that these rules will come into effect again and will be implemented on January 1, 2015. However there is doubt whether the suspension of the operation of the rules applied in 2013, given that the same Decree No. 19-2013 refers us to Article 7 of the Tax Code, however, this is not enough to give us an answer.
From October it will be mandatory for declarations for the traditional and simplified taxation regimes for income taxes, sales, withholding tax and solidarity tax to be made using the electronic platform.
From a statement issued by the Ministry of Finance:
A grace period has been granted up until October 5, 2015, for filing in the tax return without penalties charged for delays.
From a statement issued by the Executive Directorate of Revenue (DEI):
Tegucigalpa, published on August 5 - Tax Amnesty for fines caused by non-submission of tax declaration.
Decree No. 66-2015, which extends the amnesty provided for in 140-2014, was recently approved, by which 60 calendar days are granted from the day following the publication in La Gaceta, in order for tax declarations to be settled without incurring penalties from the Executive Management and Revenue (DEI).
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