Consecuencias y movilidad en el contexto internacional

The system of national accounts requires taxes to be recorded on an accruals basis, meaning when the activities, transactions or other events that give rise to tax liabilities occur (and not when the taxes are collected), and for the entries to be the amounts due (not the amounts collected or disbursed).

However, the system of national accounts does not record the amounts due unless they are documented in a tax assessment, a tax return or some other proof that establishes the taxpayer’s indisputable obligation to pay the tax.

STANDARD 3–SOVEREIGN REVENUES –REQUIREMENTS 57/202

STANDARD 3 - SOVEREIGN REVENUES

STANDARDS

1. SCOPE

1.1SPECIFIC DEFINITIONS

In this Standard, the following terms shall have the meanings given below:

Sovereign revenue

Sovereign revenues arise from the exercise of the central government’s sovereign powers. These are revenues from other parties that do not directly receive a resource of equivalent value in exchange.

Tax

Tax is a sum of money that the government requires individuals and corporations to pay irrevocably and with no direct equivalent exchange in order to cover public expenses. Tax collection is authorised in the budget.

Fines and other penalties

Fines and other penalties are financial sanctions imposed on other parties for violations of legal or regulatory requirements.

1.2SCOPE OF THE STANDARD

This Standard shall apply to sovereign revenues, meaning: - tax revenues from central government taxes and similar levies; - fines and other penalties paid to the central government. This Standard shall not apply to:

- other central government revenues either from transactions involving a direct exchange of equivalent value for the other parties (sales of goods and services, disposal of assets or use of tangible, intangible and financial assets by other parties), or from transactions with no direct equivalent exchange for the other parties, if these transactions do not involve the exercise of the central government’s sovereign powers;

- taxes, fines and other claims collected by the central government on behalf of other entities.

2. ACCOUNTING TREATMENT

2.1GENERAL ACCOUNTING TREATMENT RULES

2.1.1 – The Transition from Gross to Net Sovereign Revenues

Net sovereign revenues are gross sovereign revenues adjusted for settlement decisions that reject the validity of previously recorded tax claims and central government tax liabilities.

Settlement decisions that cancel claims shall be treated differently depending on the validity of the claim initially recorded:

STANDARD 3–SOVEREIGN REVENUES –REQUIREMENTS 58/202

- settlement decisions that reject the validity of the claim initially recorded shall be treated as a decrease in gross revenues;

- settlement decisions that do not reject the validity of the claim initially recorded shall be treated as expenses.

The transition from gross sovereign revenues to the revenues recorded in the net sovereign revenues statement shall be explained in detail in the notes to the financial statements.

2.1.2 – Determining when Sovereign Revenues are Recognised

Sovereign revenues shall be recorded in the year in which they accrue to central government, as long as the revenues for the year can be reliably measured.

2.2SPECIAL FEATURES OF THE ACCOUNTING TREATMENT OF TAXES

2.2.1 – The Transition from Gross to Net Tax Revenues

2.2.1.1 Gross Tax Revenues

As a general rule, gross tax revenues correspond to gross taxes, which are defined as the sum found by applying a tax rate schedule to the tax base.

2.2.1.2 Central Government Tax Liabilities

As a general rule, central government tax liabilities correspond to the tax measures that taxpayers can use to decrease their gross taxes.

Central government tax liabilities shall be recorded as a decrease in gross tax revenues.

2.2.1.3 Net Tax Revenues

Net tax revenues are gross tax revenues adjusted for central government tax liabilities and settlement decisions that reject the validity of previously recorded tax claims.

2.2.2 Determining when Tax Revenues are Recognised

2.2.2.1 Principles

Tax revenues shall be recognised in the financial statements if the following conditions are met: - Parliament has passed the budget authorising tax collection;

- taxable events have been carried out;

- the revenues for the period can be reliably measured.

Tax revenues shall be recorded in the year in which the taxable events occur, as long as the revenues for the year can be reliably measured.

2.2.2.2 Accounting for the Lag in Reporting Taxable Transactions

The reporting lag results in a lag between the time when the central government’s claims arise and the time when the amounts involved can be determined.

In view of this reporting lag, tax revenues shall be recorded:

STANDARD 3–SOVEREIGN REVENUES –REQUIREMENTS 59/202

- or when the taxable event is reported in a tax return (as is the case for personal and corporate income tax).

2.2.2.3 Accounting Treatment of Tax Audits

Revenues from tax audits shall be recorded in the financial statements for the year in which the collection notice is issued for back taxes.

2.2.3. Accounting for tax losses and tax credits.

The tax credits and tax losses not returnable but carried forward subject to profits or future taxable income will not lead to the recognition of a liability.

The tax losses carried forward returnable and returnable tax credits, whether they be carried forward or not, are a tax liability of the State within the meaning of this standard and give rise to the recognition of a liability.

3. DISCLOSURES

The notes shall contain a table showing the transition from gross to net sovereign revenues. It shall show the central government’s tax liabilities and settlement decisions that reject the validity of previously recorded claims.

The tax credits and tax losses not returnable but carried forward subject to profits or future taxable income are disclosed as two tables. (Figure IV):

- a table for tax losses carried forward reflects an estimation of these deficits on 1 January, new deficits over the year, the deficits used up in previous years, the corrections due to adjustments tax or expirations of the right to report during the year and the estimated deficits at 31 December. This table is complemented by an estimate of the deficit liable to reduce future revenue of the Central government;

- a table for tax credits carried forward and not returnable shows an estimate of these tax credits carried forward and not returnable to January 1st, the new tax credit carried forward arising during the year, the used up tax credits carried forward and not returnable recorded in previous years, adjustments related to tax adjustments or expirations of the right to carry forward during the year and an estimate of tax credits carried forward and not returnable to December 31. This table is complemented by an estimate of the tax credits carried forward liable to reduce future revenue of the Central government.

STANDARD 3–SOVEREIGN REVENUES –EXAMPLES 60/202

STANDARD 3 - SOVEREIGN REVENUES

EXAMPLES

I–THE DISTINCTION BETWEEN SOVEREIGN REVENUES AND OTHER CENTRAL GOVERNMENT REVENUES

This flow chart shows the criteria used to distinguish sovereign revenues from other central government revenues.

Revenue is deemed to be sovereign revenue if the two following conditions are met:

1- The transaction is related to the exercise of the central government’s sovereign powers. 2- The transaction involves no direct equivalent exchange for the other party.

YES YES NO NO Other revenues Other revenues Sovereign revenues Transaction related to the exercise of the government’s

sovereign powers?

Transaction with no direct equivalent exchange for the

STANDARD 3–SOVEREIGN REVENUES –EXAMPLES 61/202