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Key rules introduced by the Code of Tax Procedure
Greece published the new Code of Tax Procedure, Law 4174/2013, on 26 July 2013 which compliments the new Income Tax Code. Taxand Greece discusses the key rules introduced and how they will affect multinationals.
The Code of Tax Procedure brings amendments in the areas of tax compliance, assessment and collection of income tax, VAT, the forthcoming real estate property tax and all other taxes which are assessed and collected under the same framework, while setting out a number of rules which were previously spread in different pieces of legislation.
Apart from streamlining purely procedural – albeit crucial to taxpayers– issues such as the acquisition of a tax registration number and the granting of tax compliance certificates, the Code introduces in the Greek statutory context more innovative elements such as a general anti-abuse clause. The code also introduces very important changes affecting taxpayers such as a prescription period of 20 years in cases of tax evasion, which is defined in broad terms, and the simultaneous imposition of interest and penalties in the case of overdue taxes.
Other important areas governed by the Code include:
- Measures for safeguarding the State’s rights for the collection of taxes and enforcement thereof
- Transfer pricing compliance obligations
- Advanced pricing arrangements
- Voluntary tax collection programmes for financially indisposed taxpayers
- Obtaining confidential information for purposes of collecting taxes
- The procedure for appealing against tax assessments before the administration prior to commencing litigation
With the new Code of Tax Procedure, as is also the case with the new Income Tax Code, it remains to be seen whether internationally developed concepts - which are now included in this legislation - and the extended powers of the tax authorities shall be used prudently and efficiently towards actually combatting tax evasion.