The Tax Agency obtains 14,792 million euros in 2017 from its work in the fight against fraud

Annual balance of the results of tax inspections

  • These results show that the Tax Agency has exceeded by 500 million euros (3.5%) the average results of the three previous years
  • The Large Taxpayers Central Office contributed 42% of the debt settled by the Tax Agency, which amounted to 5,378 million euros, with an average of almost 200,000 euros per taxpayer
  • Debt collected from high net worth individuals amounted to 332 million euros
  • Taxpayers receiving on-site visits as part of the VAT Plan have increased by over 10% the amount of their settlements with immediate effect
  • After the 14 large coordinated operations carried out in Spain since 2013, the over 600 taxpayers affected have increased by 535 million euros the volume of declared operations in VAT and by 400 million euros in declared revenue in Companies
  • The outstanding debt fell by almost 3,500 million euros in 2017 and accumulates a decrease of 7,800 million in three years, to stand at levels similar to those of 2010

19 March 2018.- The Tax Agency obtained 14,792 million euros in 2017 as a consequence of its fraud prevention and detection operations. It thus consolidated the levels of the previous year (14,883 million), and increased by 500 million euros, 3.5%, the average results of the three-year period 2014-2016, and resulting in an all-time high in direct revenues arising from Tax Agency control operations.

14,221 million euros of the total results correspond to 'Indicator 3' targets, the results achieved by the Tax Agency in the prevention and fight against fraud, which have increased by 3.9% the average of the three previous years.

This revenue can be broken down in turn into direct revenues arising from control operations ('Indicator 3.1'), totalling 9,505 million euros, and the reduction of rebates claimed by taxpayers ('Indicator 3.2'), amounting to 4,716 million euros.

Tax Agency revenue from the fight against fraud is topped up by 571 million euros arising from untimely returns (outside the voluntary period) without prior demand for payment by the Tax Agency.

Consolidation of record inspection activity

Last year, the Tax Agency's inspection activity carried out a total of 117,380 nominal validation and investigation operations, 8.3% higher than the record levels reached the previous year. In parallel, the collected debt increased by 1.3% to reach 5,378 million euros, with an average debt per taxpayer of 199,000 euros. Of the global figure, approximately 42% corresponds to operations of the Large Taxpayers Central Office.

Additionally, reductions were made to negative bases, to unapplied tax credits and to tax offsets, which enabled tax revenue to increase to 4,027 million euros, 320 million more (+8.7%) than the previous year. The results of these activities are not included in the Tax Agency's control results due to their not giving rise to either revenue or a reduction of refunds, but are of great significance in terms of increasing future tax bases and raising tax collection levels.

In turn, within the scope of control of high-net worth individuals, where the first inspection operations have started using the new selection tool created last year, in 2017, the Tax Agency settled outstanding debts amounting to 332 million euros.

First immediate effect of the VAT Plan

In 2017, the Tax Agency increased its on-site visits ('sweeps') to further its control of high tax risk sectors. 32,215 visits were carried out, 31% more than the previous year. The sharp increase in these operations focused on the detection of the underground economy is due to the implementation, since April, of the 2017 VAT Visits Plan, which consisted of 14,698 visits, 45% of the annual on-site visits.

The first results of on-site inspections carried out on taxpayers selected by the Tax Agency Inspection Area are now being seen. These taxpayers have increased by over 10% the amount of their VAT settlements filed since the beginning of the income tax campaign, compared to the same period of the previous year.

Large-scale operations by sectors

Also of particular importance were the entry and registration operations carried out in collaboration with the large coordinated centralised operations, which are aimed at detecting underground economic activity and the presence of concealment software. Last year, 782 visits of this nature were carried out, permitting national large scale operations to extend their scope to specific sectors of activity.

The 14 large coordinated operations carried out in Spain since 2013, resulted in a sharp increase in the amounts paid during these years in VAT and Corporate Tax by the over 600 taxpayers affected, mostly companies, and also associates, administrators and persons within their area of influence. The parallel effect of the control of the underground economy has been seen in VAT revenue, with a declared volume of operations amounting to 535 million euros, as well as in Corporate Tax, where revenue declared has increased by 400 million euros.

IT Audit entry and registration operations

The importance the IT Audit Units (Spanish acronym: UAI) in these operations as well as many other automated operations throughout Spain can be seen in the results of inspections carried out in later years. Only in 2017, 4,004 registration operations were carried out, approximately 35% more than in the previous year, on taxpayers who, in recent fiscal years, had been the object of inspections by the IT Audit Units, uncovering 373 million euros, 36% more than recorded in the previous year.

In the last five years, these IT Audit entry and registration operations, which have proved effective for detecting concealed revenue, obtaining evidence in general, and reducing the time spent on tax inspections, have uncovered 1,288 million euros, with 15,200 entry and registration operations.

Reduction of outstanding debt falls to levels of 2010

The Collection Department has once again seen significant reductions in outstanding debt, which fell by almost 3,500 million euros, 7.6%, to 42,365 million euros. Thus, in three years, the outstanding debt has reduced by over 7,800 million euros, to stand approximately at the levels of 2010.

One of the main reasons for this reduction is the increase of liability transfer agreements, involving the transfer of tax liabilities to third persons other than the main debtor, injunctions and asset investigation, management of debts in the seizure stage and various improvements implemented regarding deferred payments, debt cancellation and insolvency debts.

The Tax Agency's Collection Department continued to carry out highly skilled operations in order to recover tax debts. For the purpose of detecting fake bankruptcies, in 2017 almost 36,700 investigations into financial movements were carried out, 40% up on the previous year and 8.5 times the number of such operations carried out in 2012. In addition, 4,100 injunctions have been ordered to prevent asset-stripping, 39% more than in 2012, and 16,000 liability transfer agreements have been signed, over twice the number in 2012.