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FRAME OF REFERENCEFOR ENSURING INTEGRITY

AND VALUES IN THE TAXADMINISTRATIONS

Author: Working Group on"Internal Control"

CIAT PermanentCommittee onEthics

Papersworking

22019Ethics Committee

ISSN 2644-4135

FrameofReferenceforEnsuringIntegrityandValuesintheTaxAdministrations

Series: Working Papers of the CIAT Permanent Committee on Ethics

Frame of Reference for Ensuring Integrity and Values in the Tax

Administrations

WP-02-2019

© 2019 Inter-American Center of Tax Administrations - CIAT

Permanent Committee on Ethics

Working Group on Internal Control

Developed by Spanish Delegation for the CIAT Permanent Committee on Ethics.

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Copyright: The Inter-American Center of Tax Administrations –CIAT, authorizes the

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ISSN 2644-4135

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ContentCONTENT-------------------------------------------------------------------------------------------------------------------1PRELIMINARYCONSIDERATIONS------------------------------------------------------------------------------------21.- INTRODUCTION------------------------------------------------------------------------------------------------42.- CONCEPTUALFRAMEWORK--------------------------------------------------------------------------------92.1.- ENVIRONMENTOFTHEINTEGRITYPOLICY...........................................................................................................92.2.- VALUESANDETHICALSTANDARDS........................................................................................................................92.3.- STRATEGIESFOCUSEDONRISKS..........................................................................................................................10

3.- LAWSANDREGULATIONS---------------------------------------------------------------------------------134.- CREATEPUBLICTRUSTTHROUGHTRANSPARENCYANDRELATIONSWITHTAXPAYERS 154.1.-CITIZEN'SOPINIONANDPERCEPTION.......................................................................................................................15Taxbarometersandopinionpolls...........................................................................................................................................16

4.2.-THECOUNCILFORTHEDEFENSEOFTHETAXPAYER................................................................................................164.3.-SERVICELETTERS.........................................................................................................................................................174.4.-SERVICESTOTHETAXPAYER.......................................................................................................................................174.5.-ALLIANCESWITHTHEPUBLICANDPRIVATESECTORSASGROUPSOFINTERESTINTHEPROMOTIONOFINTEGRITYINTHETAXADMINISTRATIONS(WCOPERSPECTIVE).......................................................................................................18

5.- PROMOTINGINTEGRITYANDREDUCINGTHESCOPEOFCORRUPTION---------------------245.1.- INSTITUTIONALITYANDDEMOCRATICQUALITY.................................................................................................245.2.- MANAGEMENTOFHUMANRESOURCESINTAXADMINISTRATIONS..................................................................245.3.- DECLARATIONOFINTERESTOFPUBLICOFFICIALS............................................................................................26

6.- RESPONSIBILITIES,PROCESSESANDCONTROLS---------------------------------------------------276.1.- CHANGESINPROCESSMANAGEMENT..................................................................................................................276.2.- DETECTINGIRREGULARITIESANDMANAGINGCOMPLAINTS.............................................................................276.3.- INVESTIGATIONANDSANCTIONS..........................................................................................................................28

7.- SOMEKEYIDEAS---------------------------------------------------------------------------------------------298.-SEVENBASICACTIONSFORACORPORATEINTEGRITYPROGRAM----------------------------------30ANEX1.CORPORATEPUBLICINTEGRITYSYSTEM------------------------------------------------------------31BASICBIBLIOGRAPHYUSED-----------------------------------------------------------------------------------------32

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PreliminaryConsiderations

AttheeighthmeetingoftheCIATEthicsCommitteeheldinthecityofOttawa(Canada)in April 2017, it was agreed to rethink the structure, composition and workmethodologyinordertoobtainvisibleresultsandadequatelydisseminatetheproductsproducedamongtheCIATmembercountries.Tothisend,threeworkinggroupsweresetup,ledrespectivelybyCanada,SpainandBrazil,toaddressissuesrelatedtotheirfinalobjectives.Oneoftheworkinggroupsislinkedtothedevelopmentofintegrityandvaluesintaxadministrationsandtheroleofinternalcontrolinthisregard.To begin the fulfillment of this objective, a first reflection entitled "Framework ofreference fortheassuranceofintegrityandvaluesinTaxAdministrations"hasbeenprepared,advocatinganintegralanalysisofkeyaspectsforthereinforcementofethicsandtheeffectivefightagainstcorruptionintaxorganizations.Foritselaboration,theSpanish Delegation in the CIAT Ethics Committee has been inspired by differentdocuments from International Organizations, the European Union, and commentsformulatedbythetaxadministrationsofChileandUruguay.Thereisnocleardoctrinalconceptofthetermcorruption,althoughitisusuallylinkedtothemostseriouscrimesbythetransgressionofnormsandbasicprinciplesbypublicemployees, and whose effects are devastating for the fulfillment of the taxadministrationsMission,andthetrustandcredibilityofthetaxpayers.Butthismeaning,withbeingthemostseriousandharmful,isnottheonlyone.Thoseactions developed individually or collectively, which, without constituting criminaloffenses, suppose transgressions of the legal and statutory norms that regulate thepositionandobligationsofpublicemployeescouldalsobeclassifiedascorruption,witheffectsthatdonotreachthequalitativemagnitudesofthemostseriousandperniciousformsofcorruption,alsoaffecttheobjectivesoftheorganization.Inaddition,itisnecessarytoworryaboutthosebehaviorsthat,despitenotconstitutinganexplicittransgressionofthenorms,supposeattitudescontrarytothevisionthatanorganizationwantstotransfertothecitizenship,andthereforeshouldbeavoidedastheyaffectthereputationandhinderthecreationofastrongcorporateidentity.Withthisapproach,itisintendedtostimulateandencouragedebatewithintheEthicsCommitteeandintheCIATcountries,orotherinterestedparties,fortherealizationofapracticalIntegrityguide,whichincorporatesgoodpracticesandhelpsthecountries

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in the responsible exercise of a culture and values that hinder corruption and theirregularand/ordishonestbehaviorsthatmaypersistinourtaxadministrations.

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1.- Introduction

The United Nations Convention against Corruption and many other referenceinstitutionsdonotofferanexplicitdefinitionofthetermcorruption.In general, it is recognized that it is a serious economic, social, political and ethicalproblem. At the economic level it reduces the efficiency of the use of resources,discouragesproductive investment,reducestheefficiencyof thetaxsystem, inducesperverse incentives,anddistortscompetitionandmanyothereffects.Thesocialandpoliticaleffectsarenolesspernicious,bydelegitimizingtheruleoflawanddemocracy,attackinghumanrights,increasingorganizedcrime,destroyinggoodgovernanceandpeacefulcoexistence,amongmanyotherfactors.Thetermcorruptioncannotbedissociatedfromaninventoryofhumanbehavior,itscontextandthelegal,culturalandpoliticalenvironment.Neithertheenvironmentofcivilanddemocraticethics,relatedtotheruleoflawandgoodgovernance.Itislinkedto the process by which an element or situation passes into a state of decay orperversion,alteringthebasicpropertiesandbecomingmuchmoremurkyandnegative,losingtheessenceoftheobjectoritsvalue.Allthisreferstoindividualorgrouphumanbehavior.Withinasocialandlegalapproachwecouldconsideritashumanactionthatseriouslytransgresses the legal norms and the moral or ethical principles by which ademocraticallyconstitutedsociety isgoverned,orwithrespect totheprinciplesandvaluesthatgovernthemissionofanorganization.Corruptionanditseffectstodayisaglobaldilemmathatisconsideredtoweakentheruleoflaw,violatecitizens'rights,reducepublicresources,anddissolveintegrityandidentity.However, it is difficult to establish a specificdefinitiondisconnected from apreciseenumerationofwhatarethebehaviors,whichcanbedefinedascorrupt,whichrequireabroadconsensus,andwhichislargelyfoundinthenormative,aswellastherules,regulationsandprinciplesbywhich theethical functioningof a society isgoverned.Frequently,thereferencestointegrityinpublicorganizationsareidentifiedwiththeabsenceofcorruption,andtheyplaceemphasisontheactionstobetaken,whethertopreventortodetectitintheindividualbehavioroftheirmembers.

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Thisissobecausecorruptionimpliesadeviationofbehaviorwithrespecttopatternsthatcomefromvalues,rulesandestablishedprinciplesthatareconsideredimportantand,consequently,aremandatory.Theabsenceof integrity inorganizations,admitsdifferentdegrees, themostseriousbeing the existence of corruption, which can be systemic. But even being themostserious,itisnottheonlyone.Thuswefindviolationsoftheregulationsandevenothermanifestations that do not constitute by themselves a criminal or administrativeinfractionbutthatdonotconstitutedesirableactivitiesorconductswiththemissionandvaluesthattheorganizationsintendtopromote.Asaresult,integritytransitsfromimproperindividualbehavior,toorganizedsystemiccorruption, which can affect a significant number of people and companies, whoorganizethemselvesnottosafeguardtheprincipleofpublicservicetothecitizen,butmay interfere in the conformation of policies and laws to obtain advantages andbenefitsofapersonalorcollectivenature.Corruptioninthebroadsenseis,consequently,acomplexphenomenon,butonethatcanbeminimized.FollowingAlinaMungiu("TheQuestforGoodGovernance")althoughits causesmaybemultiple, the riskof corruption isusuallygreater,when therearemoreopportunitiestoexerciseit,whichmayincreaseifofficialsenjoydiscretion,andprivilegedaccesstopublicresourcesdesiredbythecorruptersasfunds,stateassets,jobs,laws,contracts,treatments,donotqueueoravoidpayments,penaltiesandothers.It also affects, directly when there is an absence of restrictions, including ethicalcodes, applicable laws and regulations, accepted norms, controls, audits, sanctions,limitedpublicopinionandlimitedcivilsociety.To deepen the public integrity, which includes the absence of corruption inorganizations,therecommendationsoftheOECDandotherInternationalorganizationsadvisethatpolicymakersofferastrategicvisionthattakesintoaccountthecontextinwhich it isapplied,aswellasapracticalapproachofriskmanagementandstrivetopromoteacultureofintegritywiththewholesociety.IntegrityasasystemicapproachintheTaxAdministrationcanbeanalyzedfromdifferentperspectives.Fromanintegralcorporatepointofview,theTaxAdministrations(TAs)mustquestioncertain key practical issues anduse appropriate policies,programs and tools in thecontextofanexplicitcultureofintegrity.

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Keyissues Instrumentsandtools

How to establish within taxadministrations a framework topromote integrity and combatcorruption?

Ø LawsandregulationsØ Clearstatementsofvaluesandethicalstandards

Ø Risk-based strategies (riskassessment,riskmaps)

Ø InternalcontroldesignØ Existenceof an independent InternalAuditService

What role can play the Taxpayer'sRights, transparency, the fairapplication of Taxes, theaccountability in the (re)constructionofcitizens’trust?

Ø SupportforVoluntaryTaxComplianceØ Anti-fraudprogramsØ TaxpayerAdvocacyCouncilØ Open government and access toinformation

Ø LitigationmanagementØ Externalscrutiny

What preventive measures can taxadministrations take to strengthenethical performance and reduce thescopeofcorruption?

Ø Selection based on merit and otherhuman resource managementtechniques

Ø TraininginEthicsanditsdilemmasØ Declarationofinterests,assetsandnetworth

Ø RegulationofConflictofInterestØ Simplification, Process Analysis andcontrols

Ø Administrativeautomation

What can tax administrations do todetectandactoncorruptionwhenitoccurs?

Ø Regulation of complaints, channelsandprotection

Ø DisciplinaryregimeØ InvestigationandsanctionsØ Riskprofiles

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Inanycase,thetaxadministrationmusthaveestablishedaninternalcontrolsystemthatensuresareasonabledegreeofsecurityintermsofachievingtheobjectives,andespecially those related to integrity, prevention, detection and punishment ofcorruptionandotherirregularbehaviors.It is convenient not to confuse the internal control function with others, such asinternalaudit,whichalthoughtheymayhaveconnectionpoints,aredifferentiable.The system of internal control established by an organization, by itself does notguaranteesuccessinthefulfillmentofitspurposes,sinceinitsfinalperformanceotherinternalandexternalfactorsintervenethatcanhaveagreatinfluenceonitsmission.The COSO reports are currently an essential referent to link "internal control" and"goodcorporategovernance".For its part, the concept of internal audit is defined as an activity that providesindependent servicesandobjectivesof assuranceandconsultation,designed toaddvalueandimprovetheoperationsofanorganization.Theinternalauditactivityhelpsan organization to achieve its objectives, providing a systematic and disciplinedapproachtoevaluateandimprovetheeffectivenessoftheriskmanagementprocesses,internalcontrolandcorporategovernance.Relatedtotheconceptoftheinternalauditfunction,andpossiblyintegratedinit,theconceptof"compliance"emergesasa function.The"compliance" isorientedtothetasksofprevention,detectionandmanagementofriskslinkedtothebreachoflawsandregulations,with special emphasison improper conductandcorruption, inorder todevelopacultureofcomplianceinorganizations.At this point it would be appropriate to consider whether the assurance of the"compliance"functioncanbeunderstoodasoneofthefunctionsoftheauditareaoftheorganization,oronthecontraryandtakingintoaccountthecharacteristicsrequiredforeffectiveperformanceofthisfunction,itwouldbeconvenienttoalsohaveaseparateunitindependentoftheauditfunction.The"compliance"functionisalsopartofthescopeofinternalcontrolestablishedintheorganization.Theincreaseinthevolumeandcomplexityoftheobligationsthataffectanorganizationsuchasthetaxadministration,theglobalizationoftheeconomy,thedevelopmentofinformation technologies and the ethical and public transparency commitments

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currentlydemandedbysociety,meanthatmanyorganizationsacceleratecomplianceneedsandbeconsideredakeyfactorofgoodcorporategovernance.Considering this context, different models or “compliance" programs have beendevelopedthattranslateintonormswithawiderangeandscope,inspiredbythe2014ISO19600 standards onmanagement systems and compliance guidelines and the2016ISO37001standardonmanagementofanti-corruptionmeasures.Other noteworthy experiences in this regard are the compliance evaluation modelappliedbytheAustralianTaxAdministration,orthepracticalself-diagnosisguideonregulatorycompliance,goodcorporategovernanceandcorruptionprevention,editedbyTransparencyInternationalofSpain.

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2.- CONCEPTUALFRAMEWORK

2.1.- EnvironmentoftheIntegrityPolicy

The challenge for the tax administrations, as well as for the rest of the publicadministrations,istheconstructionofanenvironmentforthesepolicies,whichallowsatthesametimetoencourageintegritywhileatthesametimemakingmoredifficultthecorruptactivities,andsucceedindismantlingthesystemiccorruption,ifanymayexist.Theimpetusforthemostdemandingethicalstandardsandpracticesinvariablyrequiresleadership:thewillingnesstoseeklong-termbenefitswidelysharedand,inthecaseofsystemiccorruption,thecouragetochallengevestedinterests.AstheEuropeanUnionpointsout,seniormanagersmustdevelopthenecessarylegaland institutional frameworks, encourage appropriate behavior and show highstandardsofpersonaldecorum.Exercisingeffectiveleadershipisessential,andalsomakeexplicitthecommitmenttotheintegrityagendaanditseffectivecommunicationtotheorganization.

2.2.- ValuesandEthicalStandards

The ethical behavior begins with attitudes and values at the top of the taxadministration,includingthesubtractiontothecaptureoftheState,thecronyism,thenepotism,thebriberyandthesearchorofferingoffavors.Increasingly, public administrations are resorting to value statements to direct theexercise of public functions, flexible enough to be applied in all policy sectors,institutionalcontextsandindividualresponsibilities.Thecodesofethicsarecurrentlyincreasingly common throughout the world and all public officials are called andobligated to commit to them. Such codes of ethics are sometimes supervised byindependentcontrolbodies,whichallowsthemtobereviewedoccasionallytoensuretheirvalidityandtoknowhowtheyareappliedindifferentaspectsofpubliclifeforoperational purposes. The CIAT's Code of Ethics Framework and its self-evaluationguidehavenotbeendeployedwithsufficienteffortbycountries,withsomeexceptions,despitebeingabasicreferenceelementtoguidegoodpractices.Thecodeofconductisaveryimportantreferenceelementavailabletoorganizationstoestablish this policy and guide good practices and to prevent, detect and eradicateirregularities.

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But,byitself,thecodeisnotsufficienteither.Organizationsneedtoensure,asmuchaspossible, in all cases, that the code is known, understood and complied with byemployeesandthattheprincipleofduediligenceisbeingappliedtoprevent,detectanderadicateirregularities.

2.3.- StrategiesFocusedonRisks

Thestrategiesofactionmustbebasedonariskassessmentwheretheproblemsofintegrityorcorruptionareconcentrated,lookingfortheirrootcauses,alsotakingintoaccountthecapacityforchangeoftheorganizations.Oneofthenormalriskassessmenttoolsistheriskmap.Thiscantakeseveralforms,buttheunderlyingobjectiveisalwaysthesame,thatis,toidentifythegreatestrisksofimproper conductandcorruption.Thebasic technique is familiar toany internalorexternalauditor,andtothoseresponsibleforCompliance,sinceitisfoundinmodelssuchasCOSOIII,instandardsISO31,000,INTOSAIandothermultiplereferences.Boththeprobabilityofoccurrenceandtheimpactonceitoccurs,aswellasthespeedanddegreeofpermanenceofthebehaviorsinanascendingscale(normallylow,medium,highandevenveryhigh)areevaluated.Whethersectoralorinstitutional,theanalysiscanbeconvertedintoa"heatmap"forgreatervisualimpact.Eachcorruptionrisksourceisassignedthecorrespondingbox(forexample,lowprobability,andhighimpact).Thesquaresshadedinredrepresentthegreatestriskandthereforethehighestprioritytoadoptmeasuresinthestrategyorprogram.Thoseinyellowrepresentamoderateriskandthereforealowerpriority.Theboxesshadedingreenareusuallynotapriorityforaction.However,riskassessmentisadynamicprocess.Itshouldbereviewedperiodically,ascircumstancesmaychange.

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TransparencyInternational(TI)followingtheseprincipleshaspresentedthreephasesforthedevelopmentofariskmatrixtoformulateastrategytocombatcorruptionandimproperconductthat,inanycase,needstobemonitoredandevaluated.Thisisthediagnosticphase,theriskassessmentphaseandtheriskmanagementphase.

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Butultimately,eventhebestdesignedstrategiesbasedonthemostsolidevidenceandwith the most comprehensive risk assessment are only paper exercises, unlessaccompaniedbysolidactionplansfollowedbyactualimplementation.Thatis,apolicyofpracticalintegrity,aswellascontinuousmonitoringandcontrol.TheapplicationoftheInternalControlIntegratedFramework(COSOIII),ComponentRiskAssessment,devotesFOURPRINCIPLES(numbers6,7,8and9)tothiscomponent:

Ø Principlesixrequiresdefiningtheobjectivesoftheorganizationswithsufficientclarity,inordertoidentifyandevaluatetherelatedrisks.Boththeobjectivesandtolerance levels must be aligned with the mission vision, strategy andoperational plans. Changes in the environmentmust be analyzedwith somecontinuityandtheContingencyPlansmustbeoperationalandeffective.

Ø Principleseven states thatrisksthat threatenallobjectiveswillbe identifiedand evaluated and a Risk Map will be prepared in accordance with theorganization'sstrategy.

Ø Principleeightindicatesthatamongtherisksthatmustbemanaged,therearethosethatincreasethedifferenttypesoffraud.Theeffectivenessofanti-fraudpoliciesisalsoevaluated.

Ø Principle nine is concerned with changes both in the environment and inprocedurestodetectnewrisksrelatedtomanagement.

TheTADATPracticalGuide,toolforadiagnosticevaluationoftheTaxAdministration,pointsoutthattheTaxAdministrationsfacenumerousrisksthathavethepotentialtoadverselyaffectincomeand/oroperations.ItindicatesasComplianceRisksthosethatcangeneratelossofincomeduetofailuretoregistertaxpayers,thenon-submissionoftaxreturns,thenon-paymentoftaxes,ortheaccuracyofthetaxstatement.InstitutionalRisks refers partially to extraordinary events such as natural disasters, failure ofcomputer systems and some referrals to behaviors: sabotage, destruction of assets,strikes, and leaks of information "that leads to loss of public confidence in the taxadministration".However,bypointingoutpositivemanagementcriteriaappropriatetotheTaxAdministration,itinducesgoodpractices.Theguide,however,doesnotrefertoissuesofconduct,equityintheapplicationoftaxes,orcorruptionphenomena,ethicalinfrastructure,orfraud,allofwhichareessentialforgoodgovernance.However,thisfactorcannotbeseparatedfromthediagnosisoftheTaxAdministrations.Whatotherelementsdoweneed,toaffirmthatwedoourbesttoencouragegoodpracticesandprevent,detectanderadicateirregularitiesandcorruption?Belowwewillrefertosomeadditionalbasicactionsinmoredetail.

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3.- LawsandRegulations

Ethicalprinciplesarenormally incorporated into the legal foundationsof countries,whichprohibitbriberyandotherformsofinternalcorruptionthroughtheadoptionoflawsandregulations.Theyoftenrecognizethatcorruptionisaseriouscrimethatoftenhasimplicationsacrossborders.Briberyandotherformsofcorruptioncanaffectfreecompetitionandinvestmentflows.Multilateralorganizations,inparticulartheCouncilof Europe, the United Nations and the OECD, have played a catalytic role in recentdecades in establishing international conventions and principles that can beadoptedbytheirmembers.Eachnationalsystemisspecificaccordingtothetraditionsandlegalstructuresofthecountry,butmostStateshaveacriminallawthat isalignedwiththeUNConventionagainstCorruptionandwiththenormsoftheCouncilofEurope.SomeMemberStatesrecognizethat theyhaveanobligationtoprohibitbribery,bothdomesticallyandabroad. This requires not only adequate legislation, but, above all, a rigorousapplication forprosecutionandpunishment.Other relevant legalprovisions includelawstoprotectwhistleblowers.SomeStateshavealsolegislatedtoregulateconflictsofinterest indecision-makingand the allocation of public funds, including public procurement and Funds andSubsidies.TheCouncilofEuropehasdefinedtheconflictofinterestasasituation"inwhichthepublicofficialhasaprivateinterest,whichmayinfluenceorappeartoinfluencethe impartial and objective performance of his/her official duties". By privateinterestismeant"anyadvantagetohimself,hisfamily,closerelatives,friendsandpersonsororganizationswithwhichheorshehasorhashadbusinessorpoliticalrelations".Italsoincludesanyrelatedresponsibility,whetheraccountingorcivil.Conflictscantakemanyforms, includingofficialsor their familymemberswhohaveexternal business interests, such as participation in an applicant company orcompetitorforfinancingortheexpectationoffutureemploymentbyabeneficiaryofpubliccontracts.Themovementofpeoplebetweenthepublicandprivatesectorscanneverbeillegalandisnecessaryfortheflexibilityofaneconomy.Thereareadvantagesfor both sectors due to the transfer of technical knowledge, but also risks for thedisclosure of privileged information when public officials, whether political orprofessional, are incorporated intoprivate companieswithin their formersphereofresponsibility.Partofthesolutionmaybetheexistenceofrestrictiveclausesorperiodsofabstentionintheappointmentsandworkingconditionsofofficials,tendingtoslow

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downthe"revolvingdoor"ofofficialswhomovebetweenthepublicandprivatesectorsinrelatedfields.

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4.- CreatePublicTrustThroughTransparencyandRelationswithTaxpayers

The taxpayer, whether individual or legal entity and citizens in general, are therecipientsofthepublicservicesprovidedbythetaxadministration.The main obligation that is required both to citizens and legal entities is thecontributionthroughthepaymentoftaxestosustainpublicexpendituresaccordingtotheir economic capacity and subject to those legal principles whose assurancecorrespondstothetaxadministration.Incorrelationwiththeseobligations,taxpayersandagentsinchargeoftaxobligationshave a series of rights in their relations with the administration, which can beundermined if there is an abnormal functioning in the services provided by the taxadministration, and especially when the phenomenon of corruption occurs, whichaffectstheincomenecessarytofinancepublicpoliciesandalsotothepublictrustandthewillingnesstovoluntarilypaytheirtaxobligations.Facedwiththesesituationsoflossoftrust,thetaxadministrationhastorespondbyproviding the citizen with formal and material compliance with their obligations,adequately informingabout thedestinationof their taxpayments in termsofpublicservices,andmakingasclearandpreciseaspossibletheapplicationofthetaxrules,inordertopreventthattheapplicationoftherules(withtheexistingmarginofdiscretionintheirinterpretation),cancoverirregularactionsofdifferentmagnitudeandseverity.Fromthisperspective,asetofactionsdevelopedintheSpanishTaxAgencyarelistedbelowand,togetherwiththeexperienceofotherCIATcountries,canbeconsideredasgoodpracticesandbeincorporatedintoanintegrityguide.

4.1.-Citizen'SOpinionandPerception

Ascitizensarethemainrecipientsof theservicesprovidedbytheTaxAgency, theiropinion and perception is of the greatest relevance both for the continuousimprovementintheirprovision,andtoimprovetheirlevelofsatisfaction.It is also important to take care of a continuous communication and transparencyrelationshipwithopinionleaders,activelylisteningtotheirproposals.Fortheseperceptionsandopinionstobeknownbytheadministration,itisnecessarytoarticulateMediasthatallow,throughvariousanalyzes,statistics,studiesandforums,

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toknowtowhatextentthetaxpayerperceivesthelevelofqualityandefficiencyofthetaxservices.Taxbarometersandopinionpolls.

TheInstituteofFiscalStudiesannuallyelaboratesastudycalled"opinionsandfiscalattitudesoftheSpaniards".Thestudyisbasedonanannualsurveyofanational random sample of 1,500 taxpayers distributed in five segments(entrepreneurs,farmers,professionals,employeesandinactive).ThisstudyanalyzestheevolutionofcertainvariablesthatformthebasicnucleusofthetaxideasoftheSpanishpopulation.Oneofthesevariablesisthecorporateimage offered by the Public Treasury to citizens as well as its level oftransparency.Inaddition,follow-upshavebeencarriedoutregardingthecreatorsofopinionand the presence and image in themedia of the Tax Agency, as a source ofknowledgeandimprovement.The Center for Sociological Research conducts a yearly survey study called"Public Opinion and Tax Policy”, and contains some questions related to theactivityoftheTaxAgency.Thisstudyismadeonasampleof2,500interviewsnationwide.Foritspart,theTaxAgencyfromitswebsitepollstheopinionofthosewhohaveusedtheelectronicpresentationservicefortheirindividualincometax.

4.2.-TheCouncilfortheDefenseoftheTaxpayer

TheCouncil for theDefense of theTaxpayer (CDC) is a collegiate body that acts asguarantoroftherightsofcitizensintheirtaxrelationsformorethantwentyyears.WearebeforeanorganizationoftheStateAdministrationintegratedorganicallyintheMinistryofFinanceandPublicFunction,withoperatesasguarantoroftherightsofthetaxpayer, but also has consultative and advisory roles. It is expressly recognized asindependent in the exercise of its functions. Said independence is to be guaranteedthrough a joint representation of members of the Tax Administration andrepresentativesoftaxprofessionalsectorsandtheacademicworldinitsmanagement.AllthelogisticsandsupportforitsproperfunctioningisprovidedbytheTaxAgencythrough the Internal Audit Service and, specifically, through an operating unit that,

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althoughintegratedorganicallyintheInternalAuditservice,dependsfunctionallyonthePresidencyoftheCouncil.With regard to regulations, the CDC makes proposals that respond exclusively tosubstantive problems related to deficiencies or defects frequently detected throughcomplaintspresentedandcanalsoincludeproposalsfortherevocationofacts.

4.3.-ServiceLetters

The Service Letters, within the Excellence models and the Quality Programs, arecommunicationandinformationdocumentstothecitizenaboutthecatalogofservicesprovidedbytheorganizationandtherightstoassistance.Manytaxadministrationshavethisinstrumentthat,ifitisnotbureaucratized,allowscommunication with different types of taxpayers and a platform for continuousimprovementofgreatinterestifitisintegratedwithnetworksandcomputerforums.

4.4.-ServicestotheTaxpayer

Ø InformationandtaxassistanceprogramsInordertofavorvoluntarycompliancewithtaxobligations,andalsotaxcontrolduties,thetaxadministrationsdeployawiderangeof informationservicesandhelpto thetaxpayer,manyofthemthroughtheInternet,via(inthecaseofSpain)thewebportaloftheTaxAgencyanditselectronicheadquarters.These services include those thatmake available to citizens, through the "Informa"Program,adatabasethatcontains,inaquestion-answerformat,themaincriteriafortheapplicationoftaxregulations.Anotherofthespecificprogramsofassistanceandprovisionofservicesthataffectsthevast majority of individual taxpayers, is Web revenue, which allows adding to theincome tax returnelaborated from thedataavailable in the tax agency, anydataorincome,ormodifyingtheexistingones.Thisprogramalsoallowsafollow-upoftherefundprocedures.Theelectronicregistryallowsthecitizentosubmitdocumentswithouthavingtotraveltooffices.

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Theelectronicpresentationofreturnsandelectronicnotificationsareother linesofprogressintheprovisionofelectronicservices.Recently, the Immediate Information Supply (SII) system for VATmanagement hasbeeninitiatedforlargecompanies.

Ø Civic-taxeducationprogramIncollaborationwiththeeducationalcommunity,variousactionsarecarriedout,aimedatchildrenandteenagerstopromotetaxawarenessinfuturetaxpayerssothattheyassimilate tax responsibility as one of the values onwhich a democratic society isorganized.

Ø InstitutionalcampaignsAwareness campaigns against fraud are carried out to raise awareness among thecitizen for the correct fulfillmentof theirobligations,promoting civic responsibility,highlightingtherelationshipbetweentheincomereceivedfromtaxesandthepublicspending.

Ø TransparencyThe Transparency Law has entailed an extension and reinforcement of activeadvertisingobligations.Specifically,ithasimplementedthemandatorypublicationofinformationregardingthefunctionsperformedbythesubjectsincludedinitsscopeandorganizationalstructure,inadditiontoitsplanninginstrumentsandtheevolutionofitsdegreeofcompliance.Incompliancewiththeprovisionsofthelaw,themanagementunitoftherightofaccessto public information has been created, which is responsible for processing andresolvinginformationrequestssubmittedbycitizens.TheInternalAuditServiceofAEATisresponsibleforpresentingEvaluationReportsonthecontentoftheinformationpresentedbytheSpanishTaxAgency.

4.5.-AllianceswiththePublicandPrivateSectorsasGroupsofInterestinthePromotionofIntegrityintheTaxAdministrations(WCOPerspective)

TheWorldCustomsOrganizationapprovedinJune2008adocumentthatestablishedthestrategiclinesofactionofthecustomsorganizationsinordertoadaptthemtothedemandsofforeigntradeandeffectivesecurityandcontrolintheXXIcentury.

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This document identifies ten key points aimed at ensuring the efficiency andeffectivenessofcustoms.Oneofthemis integrity,which isdefinedasaconcept thattranscends the mere abuse of power and corruption by including standards in theprovision of public services, taxpayer rights and compliance with both theirexpectationsandthoseofinterestgroups.Pointnumbertenoftheintegritystrategyrefersto"relationswiththeprivatesector",withanexplicitreferencetothereviewoftheArushadeclarationinthefollowingterms:

"Taxorganizationsshouldfosterarelationshipwiththeprivatesectorthatisopen,transparent and productive. Taxpayer and business associations should beencouragedtoassumeanappropriatelevelofresponsibilityandtransparencyinordertoidentifyproblemsofcorruptionandtheadoptionofpracticalsolutions.Theestablishmentofagreementswithcompaniesandorganizationsrepresentingthe interests of the private sector and with civil society are very effective inpractice.On the otherhand, the establishment of codesof conduct in the private sector,whichclearlyindicatethestandardsofacorrectprofessionalpractice,canalsobeveryuseful.Thesanctionsassociatedwithcorruptbehaviorsmustbedefinedinsuchawaythattheyaresufficienttostopcorruptbehavior.

Consequently,theyconsiderthat"collectiveactions"withtheprivatesectorshouldalsobeclaimedanddefendedasaneffectiveanddifferentiatedformulainthefightagainstcorruption.

"Moreinformationcanbefoundathttps://www.baselgovernance.org/theme/icca"Althoughcollectiveactionsoffermanyadvantagesinthefightagainstcorruption,thetruthisthattheycanalsocollideandencounterobstaclesthatshouldbeanticipatedtoensurebetterresults.ThemostimportantobstaclescanbereferredtobytheWCOto:

a) Politicalwill.-Theabsenceofpoliticalwillatthehighestlevels,amongotherreasons,mayresultfrompublicinstitutionsbeingreluctanttoassumethistypeofresponsibilitybeforethecivilsociety,andconsequentlyloseinterestinparticipating,outoffearofgeneratingacertaininstability.

b) Cost inmedia. - Frequently, these initiativesmay involve investments inmaterialresources,financialresourcesandtime.

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c) Theopportunityofthemomenttocarryouttheseactionsisafactortobetaken intoaccount,because if it isnotdoneat theopportunemoment, itspossibilitiesandbenefitsmaybelimited.

d) Misguided choice of interest groups called to be part of these actions(apparently they could be interested, but they really are not, or on thecontrary,thosewhodonothavearealinterestarechosenaspartners).

Inanycase,withorwithoutobstacles,theadvantagesofcollectiveactionslieinthefactthat they make possible to bring together various interested parties, set them tonegotiate and reveal many common aspects that favor communication and thegenerationoftrust.Catalog ofGoodPractices. (Susceptible to abroader development as far as the TaxAgencyisconcerned)Wedescribebelowaseriesofexamplesofcollectiveactions,whichcouldbeconsideredgoodpracticesinthematter.ThegoodpracticescitedintheWCO'sethicscommitteeandthoseoftheSpanishTaxAgencyaredistinguished.(At thispoint itwouldbenecessary toaddexperiencesandgoodpractices fromothertaxadministrations)

Ø WCO’sEthicsCommittee- In 2007, the Government of Cameroon established the CHOC project

(Change Habits-Oppose Corruption) as a donor association aimed atstrengtheninggoodgovernance.The political decision to launch this project emerged, on the one hand inresponse to the multiple opportunities for improving governance inCameroon,andontheotherhand,fromthegovernment'swillingnesstofightagainstcorruption.Theprojectinquestionispartofagovernmentprogramthataimstoachieveasignificantreductionincorruption,althoughitdoesnotreferexpresslytothetaxadministration.Inthefirstpartoftheimplementationofthisproject,financialandtechnicalsupportwasobtainedforthedesignofastrategyandlegislationrelatedtothefightagainstcorruption,whichwasmadeknowntodifferentassociationsinthecivilsociety.Thankstothisstrategy,Cameroonnowhasacoherentandappropriatelegalframeworkandstrategytocombatcorruption.

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The need to strengthen the legal framework to deal with economic andfinancial crimes has been assumed, and cooperation between publicinstitutionsandcertaincivilsocietyassociationsgraduallytakeshold.(More information about this project can be obtained athttp://www.cm.undp.org/content/cameroon/fr/home/operations/project.html).

- Implementationofthe"MaritimeAnti-corruptionNetwork”(MACM).MACMisaplatformthathelpseliminatecorruptionpracticesinthemaritimeindustry.Itismadeupofshipowners’associationswiththemainsectorsofthemaritimeindustry,andothercompaniesthatincludecargoownersandauxiliary services. The maritime industry and the tax authorities alsocollaborateinthisaction.Thiscollectiveactionprovidesitsassociateswiththeopportunitytoassessthe challenges and find solutions together. An evaluation of the riskscenteredontheimportandexportprocedures,providesthebasistoidentifydifferentsolutionsandthememberscapableofprovidingthem.Theactionstobeundertakenareprioritizedandincorporatedintoanactionplan.Although this initiative had its origin in a private sector initiative, it hasinvolvedtheTaxAdministrationsofdifferentcountriesthathaveexpressedtheirinteresttojoin.(AdditionalinformationonthisinitiativecanbeobtainedbyconsultingBSR-MACNImpactReport2016)

Ø SpanishTaxAgency- ForumofLargeCompaniesandCodeofGoodTaxPractices.

TheTaxAgencyhas launchednew formsof cooperative relationshipwithlarge companies through the creation of a discussion forum inwhich themainproblemsthatariseintherelationshipbetweenlargecompaniesandthetaxadministrationareanalyzedthroughjointorsectoralmeetings.The Large Companies Forum was constituted in 2010 as a body ofcooperative relationshipbetween theTaxAgencyandagroupof27 largeSpanishcompaniesselectedbasedonfactorssuchasturnover,taxliability,information provided to the Tax Agency, number of workers, sector ofactivityandgeographicaldistribution.WithintheForumseveralworkinggroupshavebeencreated,oneofthemdedicatedtotheelaborationofaCodeofGoodTaxPractices.Allcompanies,whetherornot theyparticipate,canadhereto thisCode,aswellas freelydisseminatethisaccession.Itsobjectiveistoimprovetheapplicationofthe

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taxsystemamongall(companiesandtaxadministration),anditcontainsaseriesofrecommendationsofgoodtaxpracticesforbothcompaniesandtheAdministration.Otherworkinggroupshaveaimedto:

- Thepromotionof the cooperative relationship,whichhasendedwith theproposalsforthereinforcementofgoodbusinesstaxtransparencypracticesofcompaniesadheringtotheCodeofGoodTaxPractices.

- Analysisandrationalizationofindirecttaxcosts.- Transferpricinganalysis.- Analysisoftaxregulationsandreductionofconflict.- ImmediatesupplyofInformation.

BothcompaniesandAdministrationassumeasa fundamentalobjective intheir relationships to avoid conflicts in the application of tax rules and,therefore,avoidthehighcoststhattheresolutionoftheseconflictsentailforbothparties.Forcompanies,theCodesupposesascenarioofgreatersecurityin taxmatters that facilitates thetakingofbusinessdecisions; for theTaxAgencies,anincreaseintheeffectivenessandefficiencyoftaxcontrol.The Forum has contributed to the dissemination of these criteria, whichalthoughtheyarenotbinding,havebeenassumedasacommitment.

- CollaborationwithTaxIntermediariesTax intermediaries,asrepresentativesof taxpayers in theirrelationswiththetaxadministration,collaboratewiththeTaxAgencyinthemanagementoftaxes,sincetheyprovidetaxpayerswithknowledgeandunderstandingoftheirtaxobligationsandhelpthemtocomplywiththem.ThiscollaborationhasbeeninstrumentedthroughtheelectronicfilingoftaxreturnsandotherdocumentsonbehalfofthirdpartiesthroughcollaborationagreementssignedwithotherPublicAdministrations,withprivateentitiesandwithinstitutionsandorganizationsrepresentingsectorsorsocial,labor,businessinterestsandprofessionals.Inviewoftheimportantroleplayedbytaxprofessionalsassocialpartnersintheelectronicpresentationandintaxreturnsandothertaxdocuments,theTaxAgencyconsideredconvenienttoestablisharelationshipframeworkwith these tax intermediaries.To this end, theForumofAssociationsandUnionsofTaxProfessionalshasbeen setupasa cooperative relationshipbodybasedontransparencyandmutualtrust,whichultimatelyresultsinthebenefit of the taxpayer, reducing the direct relationship with officials,facilitatingvoluntarycompliancewiththeirobligations.

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- CollaborationwiththejurisdictionalbodiesTheTaxAgencydevelopsthedutyof collaborationwith the jurisdictionalbodies, through various functions, among which judicial assistance andexpertise in criminal proceedings against the Treasury, the provision oftelematics and individualized tax information to the jurisdictional bodiesandthePublicAttorneysandtheexerciseofthejudicialpolicefunctionbyCustomsSurveillanceofficers.In this sense, the collaboration is implemented, basically, through theSupport Unit of the Special Prosecutor's Office against corruption andorganizedcrimeandjudicialcollaborationinthefieldofcrimesagainstthePublicTreasury.Also in relation to the supply of information through collaborationagreements,theTaxAgencyhasestablishedacollaborationagreementwiththe General Council of the Judiciary, and theMinistry of Justice, throughwhich jurisdictionalbodiesareallowedtodirectlyaccessthedatabasesoftheTaxAgency,throughtelematicsconnectionviatheJudicialNeutralPointmanagedbytheCGPJwithintheframeworkdefinedbytheAgency.For those cases not included in the agreement, individual requests forinformationareprocessed.Otherareasofcollaborationwithinthepublicframework:- reciprocalexchangesofinformationwithtaxtranscendenceandgeneral

cooperationtoincreaseefficiencyinmanagement,improvingassistanceto taxpayers by reducing administrative burdens, and intensifying thefightagainstfraud,whichiscarriedoutwiththetaxadministrationsoftheAutonomouscommunities.

- AgreementbetweentheStateTaxAdministrationAgencyandtheStateAviationSafetyAgencytoexchangeinformationregardingtheprogramsof Authorized Economic Operator and Accredited Agent and KnownShipper.

- Collaboration agreement between the Tax Agency and the GeneralCouncil of Notaries to specify the periodic supply of information andreceivespecificinformationfortheexerciseoftaxfunctions.

- Agreement with the Official Associations of Real Estate Agents toencouragetheparticipationoftheRealEstateAgentsintheproceduresofforcedalienationbytheTaxAgencythroughtheInternet.

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5.- PromotingIntegrityandReducingtheScopeofCorruption

5.1.- InstitutionalityandDemocraticQuality

In the same way that there is a correlation between the high performance orproductivityeconomiesandthelowcorruptionreported,thefactthattheofficialsactintheinterestoftheirorganizationsisthefoundationoftheinstitutionsthatworkwell.In the book "think institutionally", Hugh Heclo appreciates the essential role ofinstitutionsindemocraticsocieties.Healsoshowsthatiftheyareinstrumentalizedbythosewhomustrepresentormanage,thisisasourceofdistrustthatcanbeextendedtothecitizens.Byitself,thisshouldbeasufficientincentive forpublicauthoritiestopromoteethicalinfrastructureandintegrityintheiractivity.Atthesametime,itisalsoadmitthatitisbettertostopthecorruptioncancerbeforeitisinstalledthantotrytostop its spread, which places prevention as the highest priority within possiblemeasures against corruption. This highlights the delicate balance that must beachieved,theimportanceofethicsatthesametimethatthemessagemustbesentthatcorruption will not be tolerated. Public authorities must move carefully in theintroductionof anti-corruptionmeasures, since implicit suspicioncancreate a toxicclimate,underminingrelationships, individualperformanceandoverallproductivity.Whileageneralobjectivecannotbeotherthantoensurethatcompaniesandcitizenscantrustpublicservices,thistrustmustalsobebuiltwithintheadministrationitself.And this confidence in the framework of the Tax Administration becomes morefundamental if possible, being a key factor in acting in one of the fields of the TaxAdministrationinwhichitispossibletodetectconflictsandsocialcontradictionsmoreclearly.TheTaxAdministrationthusappearsasaverysensitiveareaofsocialconflictand for the same reasons as a strategic field of search for consensus and sociallegitimacyindemocracy.TheTaxAdministrationoperates,therefore,inanessentiallycomplexactionfield,bothinrelationtotheindividualtaxpayerandinthecontextofsocialrelations.

5.2.- ManagementofHumanResourcesinTaxAdministrations

PublicemployeesaresubjecttoastatutoryrelationshipwiththeAdministrationthatisspecifiedinacatalogofrightsandobligationsbindingforbothparties.The rulesof actionofpublic employees indicate the limitsof rightorwrong.But inadditiontotheselimits,theAdministrationcan,forreputationalorimagereasons,pointout behavioror behavioral guidelines that,without having amandatory nature, aredesirabletoreinforcethevisionoftheorganizationvis-à-visthecitizenandsociety.

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To the extent that public employees act in the best interest of their organizations,greaterandbetterlevelsofintegritywillbeachieved.The adequate combination and balancemust be set between controlmeasures andsanctions, in order to avoid defaults and deviations from the established behaviorpatterns, while generating a corporate culture with a sense of belonging of itsemployees.It isanessential factor tostrengthenthe integrityoforganizations.Butemploymentconditions also have a great impact in the context of ethical behavior and againstcorruption.Lowwages,unstablecontracts,politicizationandlackofprofessionalismallcontributetoanenvironmentthatcanfavorthepursuitofselfishendsandconflictsofinterest.Iffairemploymentconditionsaregranted,theactionstobetakenbytheAdministrationaretoensurethatthehumanresourcesmanagementpolicyintegratesethicalvaluesinpersonnelpoliciesandprovidesclarity,especiallyforthosepositionsofgreatestrisk.TheAdministrationmust,inthissense,identifyandbeawareofthedifferentsourcesandrisksofcorruption,adaptingitspoliciestothesecircumstances.Amongthepossibleaspectsthatcanbedevelopedunderthisperspective,thefollowingcanbementioned:

Ø Selectionofpersonnelbasedontheprinciplesofmeritandability.Ø Catalog of jobs that identifies the characteristics, responsibilities, and

competences.Ø A professional and administrative career congruent with the level of

responsibility,training,meritsandprofessionalcareer.Ø Valuingaspectsofethicalbehaviorfortheperformanceofcertainjobs.Ø Performance evaluations that take into account not only technical and

equipmentfactors,butalsothebackgroundagainstethicalstandards.Ø Continuousmanagementofprofessionaldevelopmentandcareerthatrewards

ethics,includingimprovementsinsystemstopreventandcontrolcorruption.Ø Restrictions on secondary activities and external interests of staff and the

accumulationofdifferentpositionsthanpositionsthatmaypresentconflictsofinterest.

Ø Restrictiveclausesinappointmentsorcontractsrelatedtofutureworkintheprivatesectorinrelatedfieldswheretheycouldhaveadvantagesfromaccesstoprivilegedpublicinformationtoobtainpersonalbenefits.

Ø Effectivedisciplinarypolicies,incaseofbadpractices.Ø Trainingprocessesandappropriateworkshops.

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Instrategiestocombatcorruption,itisnecessarytoidentifythesourcesandpossiblerisks of corruption before assembling a package of human resources managementmeasures.Itisalsonecessarytosorttherootcausesofthemostunwantedbehaviors.Ontheonehand,officialsmustfeelabletospeakfreelyandraiseproblemswhentheyarise but, on the other hand, tax administrations must build their team spirit andcorporateculture.Officialsalsofaceethicalconflictsandambiguities,aroundloyaltytocolleagues, organization, policies, taxpayers and communication, which can beaddressed through training in ethics and conflict resolution, through EthicsCommitteesandWorkshops.Aspecificformthatisveryusefulinareaswheretheriskofcorruptionishighconsistsofatrainingbywhichofficialsareformedandanalyzetheanswerstopracticalcases.Asalearningtechnique,smalleffectivediscussiongroupsaresuggestedalongwithawidecollectionofproblematicscenarios,beingunderstoodthattheselectionmustadapttospecificaudiences.Dependingontheresultsoftheriskanalysis,institutionscouldcustomizetheirtrainingprograms,developingmodulesforhigher-riskentitiesorunits(suchaspurchasing,hiring,orcontactpersonnel)or forcertainpositions(forexample,managersandsupervisors).Theycouldalsoconsiderexplicit statements of compliance with norms and appropriate behaviors in themanagerialstafforonthepartofnewemployees.

5.3.- DeclarationofInterestofPublicOfficials

Asapreventivemeasure,somepublicinstitutionscompelpublicofficialstosubmitasigneddeclarationoftheirincome,assetsandbusinessinterests.Thismeasurecanbeappliedtothosewhooccupymanagerialorsensitiveandhigh-riskpositions,suchasthosewhomanagepublictendersandawardcontracts.Thepublicinterestinbeingabletoaccessthedataoftheofficialsmustbebalancedwiththeirright toprivacyandpersonalsecurity.Therefore, thispracticedeservesaveryselectiveapproach.

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6.- Responsibilities,ProcessesandControls

6.1.- ChangesinProcessManagement

Sometimesitwillbenecessarytochangethemanagementoftheadministrativeprocessitself,thecomputerapplications,orthewayinwhichtheadministrationprovidestheservices, so that there are fewer opportunities to engage in dishonest behavior orcorruption.Thechangeofrules,aswellasthecounterbalancewithdifferentdecisionscan minimize discretion, through the regulation of procedures and processes, theintroductionofcontrolsandtheperformanceofaneffectiveInternalAuditService.

6.2.- DetectingIrregularitiesandManagingComplaints

Realistically, irregular behavior and corruptionwill never be totally eradicated, noteven by the best prevention systems. Comprehensive strategies can succeed indismantlingsystemiccorruptionbuttherewillalwaysbeincidentsofmisconductthatthreaten good governance. This entails the need for a regulatory and informationframework,includingfaultlessdetectionandprosecutionsystems,inaccordancewiththestandards.Whenillegalorunethicalactivityisbeyondthescopeoftheauditandinternalcontrols,thereportingofirregularitieshasproventobethemosteffectivewaytounmaskbadpracticesand,accordingtosomeresearchers,isresponsibleforalmosthalfthefrauddetectioninthepublicsector.Astheprotectionofwhistleblowersisstillrelatively weak and the act of denouncing itself has not yet fully penetrated theadministrativecultureasacontributiontobettergovernance,ithasyettodevelopitsfullpotential.Inanycase,TheInternalAuditServicesmustdeployitscompetencesasattributedbythecorrespondingTaxAdministrationregulations.Acomplainantissomeonewhoinformsormakespublicinformationaboutathreatorharm tothepublic interest. In the contextofgoodgovernance, a taxadministrationofficial may disclose illegal or unethical activity by reporting internally to theorganization(forexample,alinemanagerorinternalauditor),orexternally,toathirdparty such as a prosecutor or judge. Any taxpaying citizen can also contact theTaxAdministrationthroughcomplaintsinaccordancewiththeregulationsofeachcountry.There are many examples, according to the European Union, that the reporting ofirregularities could have played a vital role in preventing potential damage, beforemoreseriousdamageoccurs.Theexperienceonthecasesofdenunciationshowsthatsometimes the complainants may suffer reprisals. These consequences include thecessation,degradation,disciplinarysanctions,harassmentordisdainonthepartofthecolleaguesorthelossofcareerprospects.

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Itisclearlyintheinterestofgoodgovernancethatofficialsandcitizensshouldfeelsafetoraiseconcernsofpublicinterest.AnintegritypolicyshouldencouragetheTaxAdministrationsstaffstodiscussmattersopenlywithintheirdepartmentsandentities,sincethisisasafeguardagainstunethicalbehavior.However,asrecommendedbytheEuropeanUnionitself,ifanofficialdetectsa serious malpractice, he can protect his own interest by calling attention to theproblemthroughconfidentialchannels,anonymouslyorevenensuringhisanonymity.Citizens’ complaints could be equally anonymous. And in all cases, the TaxAdministration must have specialized investigation bodies. (Inspectors on duty,Internal Audit) responsible for proposing confidential reports to the Directorate,containing both elements of evidence and evidentiary elements, that serve for theappropriatedisciplinaryproceduresorthedenunciationtothepublicattorney.

6.3.- InvestigationandSanctions

Minimizingirregularbehaviorsimpliesawidelysharedperceptionthatthechancesofbeingdiscoveredandtheprobabilityofbeingsanctionedforanimproperconductareboth high. On the other hand, focusing on the dark areas and designing effectivesanctions isessential toeradicatecorruption,butunless translated intoactions, it islikelythatitwillonlygeneratecynicismanddisappointment.Onceagain,followingthedocumentationoftheEuropeanUnion,inordertomaximizedeterrence,ahighprobabilityofbeingdiscoveredmustbeaccompaniedbyeffectivesanctions, which requires effective disciplinary policies and procedures withinorganizations,whichentailsanctionsincludingfines,lossofemployment,andlawsuits.Theinvestigationandapplicationofsanctionsnotonlyservetodissuadeotherpublicofficials, but also reveal to taxpayers and citizens that officials are really heldresponsiblefortheiractionsoromissionsinmattersofirregularorcorruptbehavior.

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7.- SomeKeyIdeas

Ø Itishighlynecessarytoagreeandadoptanormativeandasetofdeclaredvalues(ethicalcodesand instructions),withinthegeneral frameworkofprinciplesandvalues of good governance, to guide the behavior and actions in the field ofintegrity,whichmustcountontheexplicitcommitmentoftheSeniorManagement.

Ø Itisnecessarytoelaborateandapplytailor-madepoliciesandstrategies,designedaround the most critical sources of risk of dishonest behavior and corruption,identifying potential opportunities and the absence of controls, evaluating theprobabilityandimpactofmakingthatrealityarealityriskandtherootcausesthatproduceit.

Ø Ensure that these policies and strategies are comprehensive and constitute asystemicmodel,sinceisolatedinstrumentstendtobeineffective.

Ø Adoptabalancedapproach(encourageethicalbehavior,deterrenceanddetectionof corruption) that builds trust within the tax administration itself, as well asbetweentaxpayersandcitizens.

Theultimategoalmustbetoreachapointwherethevaluesareinternalized,therulesare explicit, and the recourse to enforcement is the last spring. Good governance issynonymouswithethicalmanagement.

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8.-SevenBasicActionsforaCorporateIntegrityProgram

STANDARDSAND

STANDARDS

RESPONSIBILITIES

INTEGRITY COMMUNICATE

MONITOR STREAMLINE

ANSWER

Theorganizationmustformallyestablish theexpectedbehaviors ofitsemployeesin relevantmatters ofethics andintegrityusing normsandstandardsfrom CIATand fromInternationalOrganizations

The Managementmust monitor theeffectiveness of theintegritycomplianceprogram.Processmanagementresponsibilitiesmust follow up /Internal Auditassume its Controlresponsibility.

Taxadministrations should avoidassigningpositions ofresponsibilitytopersonswhohavecommitted badpractices orbehaviorincompatiblewith aneffectiveprogram ofcomplianceandethics.

Communicateperiodically andpractically andtrain with theaim of ensuringthat employeesknow andunderstandwhatisexpectedofthem.

Periodicevaluationand audit ofthe elementsimplementedin ethics andcompliance.Periodicevaluation oftheeffectivenessof theprogramimplemented.Define aconfidentialsystem forreportingbadpractices.

Evaluaterisksand align theprogramaccordingly.Establishincentivesand ensurethe adoptionofdisciplinarymeasures,withconsequencesincaseofnon-compliance.

Once a badpractice isdetected,theorganization must doeverythingpossible toeradicate itand preventit fromhappeningagain in thefuture,ensuringthat theethics andcomplianceprogramremainsupdated.

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Anex1.CorporatePublicIntegritySystem

Mission, Vision, Values, Culture, StrategyCommitment Of Top Authorities And Leadership With The Integrity System

HR Policies

Responsibilities and Processes

Relationship with Taxpayers and Accountability

Analysis, Evaluation and Risk management

Follow-up, Monitoring, Evaluation and Internal audit

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2. WORLDCUSTOMSORGANIZATION.SUBCOMMITTEEOFINTEGRITY.16Session.January2017

3. RecommendationoftheOECDCouncilonPublicIntegrity.4. CIATModelCodeofConduct.20055. Self-evaluationGuideforTaxAdministrations.20086. Practical guide to self-diagnosis and reporting on regulatory compliance, good

corporategovernanceandpreventionofcorruption.TransparencyInternational.Spain.2017

7. Internal control. Integrated Framework Illustrative tools to evaluate theeffectivenessofanInternalControlSystem. Instituteof InternalAuditors(IAI)/PWC.May2013

8. ApplicationoftheInternalControlIntegratedFramework(COSO)intheSpanishPublicSector.InstituteofInternalAuditors(IAI).2016

9. ISOstandards:- ISO19600onComplianceManagementSystems-guidelines.- ISO37001Year2016Anti-briberymanagementsystems.- ISO31001Year2009RiskManagement.

10. KPMGDesigningEfficientIntegrityFrameworks.201211. AEATMemories.Years2015and2016.AEATofSpain.12. TADAT.PracticalGuide.ToolsforadiagnosticevaluationoftheTaxAdministration.

November201513. Marco de Procesos para la elaboración del Mapa de Riesgos 2018-2020. AEAT

España.14. LecturasdeGerenciadesdelaAdministraciónFinanciera.IEF1996