Tax Agency defends sanctions of the 720 Form

720 Form

The Ministry of Finance is willing to maintain the sanctioning regime for the declaration of property abroad (the famous 720 form) despite the Brussels warning. Hacienda is prepared to defend its rule before the Luxembourg Court.

 

Last week the European Commission issued a warning to Spain about the tax regulations on foreign assets. Brussels asked him to change the 720 form because considers that "the fines imposed in case of non-compliance are disproportionate". 

 

Sanctions that may amount to up to 150% of the amount defrauded. In addition, it provides sanctions of 5,000 euros for each omitted data with a minimum of 10,000 euros. The reality is that large fines arrive only for completing the form incorrectly, or omitting a data in a box that is included in another section.

 

"If a satisfactory answer is not received within two months, the Commission can bring Spain before the Court of Justice of the European Union (CJEU)," According to the reasoned opinion issued last week by the European Commission.

 

Tax Agency explains that will defend its position. Argues that the Commission's opinion is contradictory because it seeks to soften tax penalties when, on the other hand, it demands more force in the fight against fraud. Hacienda explains that the rules on sanctions of the model 720 strictly comply with what is established in the Spanish legislation.

 

The Ministry insists that it will go all the way to defending the 720 form sanctions regime. And it is prepared to defend its arguments before the Court of Justice of the European Union. Hacienda believes that thanks to this measure has obtained a rich database to combat tax fraud, especially some of the taxpayers with more wealth and with more facilities to avoid the tax.

 

INCREASE of fiscal data

 

On 20 September 2016, the Tax Agency published a report in which it stated:

 

 "The declarants of goods abroad raised their tax base by 78% in the Tax on the Patrimony after the process of upbringing of assets

 

The respondents of the '720' already represent in 2015 31% of the tax base of Patrimonio, compared to 12% before the process of asset outlays and income regularization began

 

This evolution reflects that the upwelling of hidden goods abroad has generated a strong increase of bases and of declarantes in the highest sections of the Tax on the Patrimony"

As a result of these data the Tax Agency has known that the Spaniards have goods abroad for almost 100,000 million euros,

 

The wealth tax applies to those who have a general property of more than 700,000 euros, taking into account that the main dwelling is exempt up to the first 300,000 euros.

 

Remember:

Deadlines: from 1 January to 31 March 2017.