TAX. Crime of Threats to Prosecute possible Tax Fraud January 25, 2021
On 2020, throughout different communication media and social networks it was widely broadcasted cases that the Tax Administration Service (TAS) agreed with different Companies, both national and international, the payment of tax assessments determined at their expense, under the argument that in case of not pay they could be subject to criminal proceedings filed by the Federal Tax Prosecutor Office (FTPO) regarding the possible commission of a tax fraud. Said tax assessments were sub judice since having been challenged before the Federal Courts.
It should be noted that the meetings in which such agreements were reached, the legal representatives of the Companies and/or Management Bodies (e.g. Board of Directors) were not able to attend accompanied by their tax advisors and/or lawyers in order to be properly assisted and advised in accordance with the corresponding legal framework and look after the Companies’ interests.
In terms of article 65 of the Federal Tax Code (FTC), as a general rule, the omitted contributions determined by tax authorities when caried out their powers of verification, and other tax assessments, must be either paid or guaranteed, including its accessories, within the following 30 days subsequent to the date in which the notification becomes effective.
Nevertheless, according with the provisions set forth in article 144 of the FTC, the tax authorities cannot demand the payment of tax assessments nor carry out an enforcement administrative proceeding (e.g. seizure) for such purpose when before the expiration of the term mentioned above the taxpayer (i) demonstrated that the tax assessment has been challenged and duly guaranteed, or (ii) that the administrative appeal (recurso de revocación) was duly filed against it, without the obligation to guarantee until any of the legal remedies stated in said article are resolved.
The first paragraph of article 114-A of the FTC foresees the crime of threats performed by a public official and by any means against a taxpayer or its representatives or dependents, with the purpose of filing a criminal charge in order to prosecuting the possible commission of tax crimes.
For the above, if a public official from the TAS, from the FTPO, or from another Coordinated State demands the payment of a tax assessment that is not enforceable, by means of coercing, browbeating and/or threating a taxpayer, in addition of violating the Rule of Law, as well as domestic provisions and international treaties, such public official will incur in the commission of a federal crime.
In the event that the legal representatives of the Companies and/or Management Bodies require to attend at any kind of meeting with tax authorities, we suggest assisting to such meetings with their tax advisors and/or lawyers in order to prevent and avoid as much as possible, any similar situation as the aforementioned cases, and if necessary, set the preventive and corrective strategies and actions that are relevant.
If you have any questions regarding the foregoing, please do not hesitate to contact us.
Mexico City, January 25, 2021