3.1.1. Selective control and investigation

The selective control and investigation actions have the purpose to detect and regulate the most complex noncompliances and to pursue the most sophisticated fraud methods. Its selective character makes them focus on the taxpayers that present a higher tax risk. They have a large investigating element and generally entail a global revision of the tax situation of the taxpayer being investigated, for which the bodies that carry them out have the most unrestricted authority that regulations give to Tax Administrations.

The selective control actions are carried out by the Financial and Tax Inspection bodies when they refer to internal taxes, and by the Customs and Excise bodies as for the taxes on foreign trade and the Special Taxes.

These actions usually end with the corresponding administrative settlements regularizing the tax situation of the obliged taxpayer or with the report to the Tax Authorities when offences against the Public Treasury, money laundering or smuggling are noticed during the actions.

The principal magnitudes resulting from the selective control activities are the following:

*Amount in millions of euros

**On 23 July 2014 the amount corresponding to this item is rectified.

Furthermore, 652 reports have been filed in 2012 to the Tax Authorities for offences against the Public Treasury for a total amount of 604,431 million euros.

*Amount in millions of euros

Between the risk areas or sectors that have been the target of controls in 2012, the most frequent are underground economy and incomes not reported, harmful tax planning and smuggling.

In 2012 a specific programme for on-site actuations has been developed in sectors in which there were higher levels of underground economy, especially in economic activities whose customers are end-consumers, and focused on the compilation of information, the verification of the fulfilment of tax obligations and the detection of incomes not declared, on occasions with the collaboration of Labour Inspection. For that purpose the starting point has been the analysis of the information available, especially on electricity consumption and credit cards. 14,331 of the 16,136 actions started have come to an end.

4,783 on-site actions have finished which were directed to the detection of the leasing of houses and business premises that have not been declared.

On its part, the Tax Agency's strategy of the directed to fight against fraud schemes of intra-Community Value Added Tax has continued, with special emphasis on the preventive actions directed to the clean-up of the tax register of Intra-Community Operators. In this manner, 12,439 control and follow-up documents on the Register of Intra-Community operators and of the Register of Monthly Refunds have been processed.

In relation to the harmful tax planning, some control actions have been carried out, especially on the offences that intend to make fraudulent use of the payment differences between countries, the irregular use of transfer pricing, the improper tax deduction for intra-group financial expenses and the anticipated or irregular compensation of negative taxable amounts generated out of Spain.

In 2012 there were many control actions on transfer pricing in operations carried out by multinationals and large companies with the aim of reducing or eliminating taxable bases that should be paid in Spain, from which there has been adjustments in the taxable base of over 472 million euros, and the actions of regularisation of the improper tax deduction for intra-group financial expenses, which have caused increases in the declared taxable bases of more than 1,700 million euros.

On the issue of smuggling, the Tax Agency carries out surveillance and control actions in the Spanish maritime and air space in coordination with other State bodies and, especially, in the customs areas directed to the repression and control of smuggling of narcotics, tobacco, counterfeits and other genres, and of the money laundering related to it. During 2012 the priority has been the fight against tobacco smuggling.

Thanks to these actions, in 2012 109,537 kg of hashish, 6,914 of cocaine and 8,727,179 packs of tobacco have been seized, and 2,587 smuggling offences and 102 money laundering crimes have been reported.

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