The Tax Agency paid over 600 million euros to large assets in 2019, up 75%
Annual balance of the results of tax inspections
- 29,600 control actions have been carried out on large companies, assets and the underground economy
- Inspections of taxpayers for whom information has been received on accounts abroad have led to the liquidation of 293 million euros in 2019
- More than 2,900 inspections with the discovery of hidden sales have allowed the regularization of quotas amounting to 674 million
- Tax information campaigns on rentals have already increased the number of taxpayers by 228,000 and have generated an expansion of tax bases of more than 2.6 billion euros in these years.
- In 2019, the Tax Agency has obtained 15.715 billion euros of income as a global result of its control work and has made reductions in negative tax bases, deductions in quotas pending application and quotas to be offset, with an effect in terms of increased tax quotas of almost 7.2 billion euros, more than double that of the previous year.
July 2, 2020 .- The Tax Agency has significantly increased the results of its control actions on the large assets of individuals in 2019, so that last year it managed to settle debt for an amount of 608 million euros, 75% more than in the previous year, also increasing (+78%) the number of completed files (880), so that in two years there has already been an increase of 156% in the files closed on this group of large fortunes.
The evolution of voluntary compliance by the group of taxpayers with the greatest fortunes also shows a powerful induced effect of control actions, given that in 2019 their taxable bases in personal income tax have grown by 16% year-on-year and their quotas by 13%.
The number of inspections is increasing
These results are part of a new model for measuring audit activity carried out by the Agency, a model that, for two years now, has gone beyond the traditional division between intensive and extensive control to place the analysis within the scope of the typology of actions, thus giving priority to the selection of fiscal risks and the use of one procedure or another (intensive or extensive) based on efficiency criteria.
In its second year of operation, this new measurement model therefore already allows for year-on-year comparisons for each of the new action headings. Overall, the Agency carried out more than 1,664,000 internal tax control actions in 2019, which is 5.6% more than the previous year, of which more than 1,613,000 (+5.3%) are verification actions and more than 51,000 are investigative and auxiliary actions (14.6% more).
Of this total number of checks, 29,631 nominal actions (+7.3%) were directed at large companies, personal assets, corporate abuse and the black economy, with these types of actions consuming a large number of resources, also characterised by their high qualification.
Specifically, the Agency carried out 20,144 actions on large companies, multinationals and tax groups (up 8.6%), 2,447 checks on asset and corporate analysis (+1.2%) and 5,241 in relation to the concealment of activity and the abuse of corporate forms (up 4.7%).
The figure of 29,631 checks is completed by 1,799 actions (9% more) which have led to the emergence of hidden sales within the framework of the control of economic activities. These 1,799 actions are added to those that have also led to the emergence of sales, but which are already included in the previous sections on asset and corporate analysis, and concealment of activity and abuse of corporate forms.
In terms of overall revenue collection, and as a result of its work in preventing and combating fraud, in 2019 the Agency obtained 15.715 billion euros, 4.1% more than the previous year.
The Tax Agency also made reductions in negative tax bases, deductions in pending tax rates and offsets, with an effect in terms of increased tax rates of almost 7.2 billion euros, 118% more than the previous year and 95% more than the average of the previous three years. Of this total of almost 7.2 billion, 73% corresponds to actions by the Central Delegation of Large Taxpayers.
These are very important actions that, although they do not count in the control results, as they do not involve income or a reduction in refunds, are of great importance in broadening future tax bases and increasing revenue. Specifically, this year, and in accordance with the guidelines of the Annual Tax Control Plan, this aspect of tax control will be promoted through the implementation of a special plan that will add to the usual actions a greater emphasis on the review of negative tax bases pending application by companies in future years.
Catalogue of 570 suppliers of great fortunes
In parallel with the increase in liquidations of large fortunes implemented by the different territorial areas of the Agency's inspection control, in its first full year of operation, the new Central Unit for Coordination of the Control of Relevant Assets is developing a series of projects to continue strengthening and updating the control systems over the group.
An example of this is the creation of a catalogue of more than 570 suppliers of luxury goods and services that the Unit has considered can be associated with taxpayers with very high economic capacity (private clubs; high net worth investment managers; jewelry stores, art galleries and auction houses; leisure centres, etc.).
By analysing these suppliers, the Unit has obtained information that is proving very useful in detecting the direct recipients of these luxury goods and services and, once detected, in uncovering tax irregularities involving large fortunes and also assets directly hidden behind shell companies, in order to regularise non-compliance and ensure the collection of debts by the Collection Department.
Control based on information from foreign accounts
In recent years, the different tax administrations have seen their capacity to act on undeclared income reinforced by successive European directives on the automatic exchange of information ('DAC'), standardized mechanisms at the OECD level and other agreements.
Following the necessary work of purifying and consolidating information, the Tax Agency can begin to offer quantitative results of the subsequent control work.
In this sense, the inspection control on taxpayers from whom information on financial accounts abroad has been received through the European 'DAC2' directive, the OECD CRS standard and the 'Fatca' agreement with the US has made it possible to settle in three years more than 435 million euros to 1,200 taxpayers, of which 293 million have been concentrated in 2019.
In addition, last year extensive controls were promoted on income reported through a previous European directive, the so-called 'DAC1', information that the Agency had been using until now especially to encourage compliance in the voluntary period of declaration of personal income tax through 'warnings' in tax data.
In this other phase, that of the administrative audit, the actions carried out have generated liquidations by the Agency and late declarations by taxpayers for a total amount of more than 55 million euros through more than 26,000 files.
Offshore cards
Furthermore, the information collected by the National Fraud Investigation Office on the use of cards issued abroad ('offshore cards') has allowed the Agency's various territorial departments to settle debts amounting to 58 million euros in 2019 and a total of 79 million since 2018. In addition, last year, files were opened that affect 57 taxpayers with offshore cards and that will offer additional results in the future.
Also among the most relevant actions this year are those carried out in the field of international taxation, and especially those that had the support of the National Office of International Taxation. In 2019, the ONFI participated in 76 completed inspections, which resulted in adjustments to the tax base estimated at 1.84 billion euros.
The ONFI has also participated in the management of 25 Advance Valuation Agreements (APA) with an estimated result that guarantees future tax bases for an amount of more than 2.1 billion euros.
Combating the underground economy
At the same time, the Agency has continued to maintain intense monitoring activities to uncover hidden economic activity. In 2019, it carried out 2,927 inspections under different verification programs (the aforementioned 1,799 in the field of control of economic activities and the rest in other programs) in which it discovered hidden sales, regularizing quotas for an amount of 674 million euros.
In this fight against the underground economy, the Computer Audit Units (UAI) continue to play an essential role, having participated in 2,181 raids and searches in 2019 (13.9% more), with computer dumps that facilitate the discovery of hidden income, allow for improved evidence gathering and reduce the duration of checks. Actions of this nature resulted in the regularisation of fees and penalties amounting to 302 million euros in 2019 through 5,466 inspection reports for taxpayers who have previously been the subject of interventions with the UAI.
This activity affects actions spread across the entire national territory, including those carried out within large coordinated macro-operations with entries and records that are being developed to discover hidden economic activity and detect software for concealing sales in specific sectors of activity.
As a result of these macro-operations carried out in recent years, in 2019 the Agency settled tax dues amounting to 76 million euros, raising the overall balance of this type of actions to 267 million euros settled through more than 1,200 files of the Inspection Area.
All these inspection activities in the field of combating the black economy are complemented by the inspection plan. In 2019, the Agency carried out more than 30,700 on-site inspections ('peinados') aimed at on-site control in sectors and areas of fiscal risk. These actions include more than 1,100 complementary visits to the sectoral macro-operations of entry and registration, 22.8% more than the previous year.
However, the program with the highest number of visits, more than half of the total, continues to be the IVA Visit Plan (more than 15,500 files, a figure similar to that of the previous year), which has yielded a positive result of more than of 60%, up to 104 million euros, in the VAT income of the companies affected by the visits in the period between the beginning of the 2019 plan and the end of the year, compared to the same period in 2016 (the year prior to the first 'VAT Plan').
These analyses allow us to assess the induced effect of these actions from a more global perspective, given that these taxpayers have since become aware of the Agency's interest in strengthening this area of tax control.
Submergence of submerged rents
Another particularly important chapter in the field of the fight against undeclared activity is the control of black market rents, where the induced effect of sending tax data notices to alleged landlords during the latest Income Tax campaigns continues to stand out.
In four years, these notices have generated an increase of more than 228,000 taxpayers (40% of the total increase in taxpayers of real estate income in the period), with a higher declared tax base of more than 2.6 billion euros (which would explain 47% of the total increase in real estate income in the period).
Results of the Collection Area
Within the area of Collection, the most qualified actions have continued to be promoted to achieve the effective collection of tax debts. In this regard, 23,552 referrals of responsibility were made, more than double the number from the previous year. At the same time, the amount of debts owed by senior debtors to third parties has also doubled, reaching 2.28 billion euros.
In turn, in 2019, 611 proceedings were processed (74% more) for prohibition of disposing of real estate of companies whose shares or stocks have been mostly seized because they belong to a debtor, and 1,614 requests for information or seizure were made to foreign authorities for the collection of debts, 78% more than in 2018.
Furthermore, during the past year, the usual tasks of controlling special and environmental taxes, customs control and matters relating to smuggling, drug trafficking, money laundering and other economic crimes were also carried out. At the same time, the usual activity of collaboration with the justice system and with other administrations at the national and international level has been maintained, and fraud prevention has been promoted through information and assistance tools and cooperative forums in which the Tax Agency participates.