April 5, 2023
In order to bring the collection files at the Tax Receiver to a manageable level and to also provide the whole Tax Authority with the opportunity to work in the present, an adjustment has been made to the collection policy of the Tax Receiver. In essence, this adjustment means that tax assessments relating to the tax years 2017 and older will no longer be actively collected. This was announced in a press release from the Ministry of Finance: “Adjustment of the tax authority’s collection policy” (in Papiamentu: “Ahuste di e maneho di kobransa di servisio di impuesto”).
The press release was posted on the personal Facebook page of the Minister of Finance, Mr. Javier Silvania.In this press release is stated that “this does not explicitly mean that the debts have been written off, but that the Tax Receiver will focus its collection capacity on recent tax assessments with a high collection probability.” It also indicates that there are three exceptions to this new rule included in the collection policy. Tax assessments for the tax years 2017 and older will still be collected in the following cases, according to the press release:
(i) if they have been imposed as a result of a criminal tax investigation;
(ii) if the tax debt for the years 2017 and older amounts to NAf. 1 million or more and the Tax Authority has information indicating that there are recovery possibilities; or
(iii) if the tax debt for years 2017 and older has already been paid into a third-party account (such as with a notary).
Furthermore, the press release states that this policy change also means that objection letters against tax assessments for the years 2017 and older will no longer be processed unless the taxpayer indicates that it has an interest in doing so. This may be the case if granting the objection could lead to a refund of an already paid or settled amount. With this, adjustment of the collection policy also contributes to the reduction of the large inventory of objection letters, because about 25% of the approximately 45,000 objection letters still need to be processed relating to tax years 2017 and older, according to the press release.
Some general remarks to take into consideration from our side:
· Land lease (in Dutch: “erfpacht): it is unclear whether this new policy also applies to the collection of the land lease by the Tax Receiver;
· Letter of appeal and position Tax Court: what will the Tax Court do with pending appeals that were filed against tax assessments for the years 2017 and older, as in many cases there will be no interest more in the proceedings if the tax assessments will no longer be collected;
· Rights to derive: an important question that still remains is what this new policy means for the legal certainty of taxpayers;
· Debtor’s overview: Considering the prevailing uncertainty resulting from the various recent collection actions, we suggest proactively contacting the Tax Receiver to inquire about the status of the tax assessments. This can be done, for example, by requesting a debtor overview.
For more information on the press release of April 3, including the background to this policy change described therein, we refer you to the press release itself on the Minister’s Facebook page.
If you would like to discuss the impact of this policy on your business or personal situation, please feel free to reach out to your HBN Law & Tax contact or one of the persons below.