Guidelines of 2020 Annual Tax and Customs Control Plan: measures concerning excise duties and environmental taxes

On January 21, 2020, the Spanish tax authorities released the general guidelines of the 2020 Annual Tax and Customs Control Plan. After reviewing these guidelines, below we outline the most significant aspects regarding excise duties (“ED”) and environmental taxes:

1. BREXIT

In connection with BREXIT, the guidelines stress the need to continue adjusting IT systems to ensure appropriate control of goods subject to excise tax (“excise goods”) after the United Kingdom leaves the EU.

2. Immediate filing of accounting books for ED (Suministro Inmediato de Libros Contables en materia de Impuestos Especiales, “SILICIE”)

ED audit units will specifically monitor the movement of stock and raw materials related to ED on manufactured goods.

This control will be performed through the new SILICIE system, which will be the communication channel between taxpayers and ED audit units..

3. Tax and customs fraud control: tax and non-customs warehouses

Tax and non-customs warehouses will be monitored to prevent their use for tax evasion purposes. The tax authorities will review the information to be provided by warehouse owners to check whether ED are appropriately charged.

4. ED fraud control

The following measures have been announced:

• The tax authorities will review all documents to be filed for the application of the standstill regime, under which, following the taxable event, the taxation of the manufacturing, transformation, holding and movement of excise goods remains suspended.

• In higher risk cases, the tax authorities will increase their visits to taxpayers’ premises.

• The various tax agency departments will remain coordinated to fight tax fraud in the areas of customs duties, ED, environmental tax and VAT

See below more specific measures regarding the following taxes:

• Excise duty on mineral oils
  • Strengthened control on tax exemptions, tax discounts and tax-free destinations.
  • Control over the distribution of mineral oil products evading the IEH other than within the tax warehouse network and the intra-Community movement regime

• Excise duty on certain means of transport (“IEDMT”): the tax authorities will check whether tax bases are accurately stated on the relevant tax returns, as well as the application of tax exemptions, non-taxability and tax rates (particularly those related to emission levels).

• Excise duty on electricity (“IEE”): the tax authorities will verify whether tax bases are accurately stated on the relevant tax returns.

• Control over excise goods: tax authorities will monitor undeclared sales of excise goods (diversion of products subject to the standstill regime).

• Control over tax schemes in the mineral oil sector: the tax authorities will seek to prevent IEH and VAT evasion, also preventing taxpayers from abusing the tax warehouse regime. 

5. Action relating to environmental taxes

• Tax on fluorinated greenhouse gases: based on the information provided in form 586, the tax authorities will:
  • Check non-taxable transactions to find taxable events misrepresented on the relevant tax returns.
  • Monitor goods bought by persons and entities not registered in the Fluorinated Greenhouse Gas Regional Register.
  • Monitor the tax-exempt allowances of received and emitted fluorinated greenhouse gases allocated to and declared by resellers.
  • Monitor self-assessments and tax returns filed by resellers
  • Monitor certain intra-Community acquisitions by resellers.
  • Monitor product sales and deliveries, and compliance with any related tax obligations.
  • Carefully monitor all intra-Community acquisitions of gases subject to the tax.
  • Monitor importers.
  • Investigate hidden distribution channels.

• Tax on the value of electricity production (“IVPEE”): the tax authorities will check whether tax installment payments are in line with annual self-assessments.

6. Formal tax obligations relating to ED and environmental taxes

• ED on manufactured goods: tax authorities will monitor (i) registration in the relevant tax rolls and registers; (ii) the appropriate allocation of tax benefits (e.g., the correct application of the standstill regime, and tax exemptions and discounts); (iii) that taxpayers hold the required permits for the movement of goods; and (iv) that establishment owners hold operating and valid permits for approved establishments.

• IEE: the tax authorities will refine and update taxpayers’ rolls and registers.

• Excise tax on coal: the tax authorities will check compliance with any formal obligations relating to this excise duty.

• IVPEE: the tax authorities will check whether IVPEE returns are filed correctly.

• Taxes on the production of spent nuclear fuel and radioactive waste, and on the storage of that fuel and waste in centralized facilities: the tax authorities will check compliance with any formal obligations relating to these excise duties.

Ultimately, the Spanish tax authorities’ statement for tax year 2020 regarding ED and environmental taxes focuses on (i) fighting tax fraud; and (ii) checking compliance with tax filing requirements and any related formal obligations, as well as with the filing of accounting records through SILICIE.