Originally published in the February 16 edition of World Tax Daily (Copyrights Tax Analysts)
Otacílio Cartaxo, chief commissioner of Brazil’s Federal Revenue Department, on February 1 released the results of Brazil’s 2009 tax audits, revealing that between corporate and individual taxpayers, the department assessed more than BRL 90 billion (about $48.6 billion) in federal taxes, the second-highest amount in the past 10 years.
Between January and December 2009, the Federal Revenue Department began tax procedures against 474,813 taxpayers, resulting in BRL 90.39 billion in assessed taxes, penalties, and interest. The 2009 assessed taxes are more than 20 percent greater than the BRL 75.2 billion assessed in 2008 but smaller than the BRL 100.15 billion assessed in 2007.
The highest number of procedures (4,222) against corporate taxpayers were initiated against the service sector, generating BRL 13.27 billion in assessments, followed by industry (BRL 37.67 billion), commerce (BRL 13.7 billion), and civil construction (BRL 1.32 billion). The financial sector was seventh in number of assessed taxpayers, but fourth in assessment value, with almost BRL 6.8 billion in assessed taxes.
Among individual taxpayers, company owners and management were the most targeted with 2,015 tax procedures (BRL 1.37 billion in assessed taxes), followed by public servants, with 1,440 procedures and BRL 264 million in assessed taxes, and professionals, with 1,228 procedures and BRL 410 million in tax assessments.
Corporate income tax tops the list of assessed taxes with BRL 27.9 billion, followed by the federal excise tax (IPI) with BRL 13.6 billion, the 9 percent social contribution on net income (CSL) with BRL 11.9 billion, payroll tax with BRL 8 billion, and the Contribution for the Financing of Social Security (COFINS) with BRL 7.2 billion.
The tax assessments resulted in 7,920 fiscal representations for criminal purposes — that is, notices prepared by a tax agent to the Federal Revenue Attorney General’s Office that may initiate a tax crime investigation or prosecution.
David Roberto R. Soares da Silva