The Recent Trend Of Tax Authorities To Sink Information – Basis Of Tax Assessments

During court proceedings, tax authorities refuse to present documents that confirm tax assessments based on the confidentiality of such documents and commercial secrets.

Evidence in tax disputes does not meet the criteria for confidential information, including the limitation of access to the information, the commercial value of the information, the commercial interest of the owner of the information and its protection measures. Failure of evidence in court violates the principle of the competitiveness and equality of the parties, the principle of taxation certainty, and the rights and obligations of the parties. The submission of a petition on calling evidence is one way to protect the taxpayer's rights with respect to obtaining access to documents. The experience of our litigation lawyers

Our litigation lawyers have encountered situations where tax authorities performing audits on transfer pricing have referred to the price quotations of officially recognized sources of information. However, in the course of tax audits and legal proceedings of tax audit appeals, the tax authorities have refused to grant access to such publications based on their confidentiality in view of the fact that the documents are freely available and can be purchased independently.

What rules are violated?

Such non-provision of evidence is unreasonable because it causes material violations of the following principles of law:

Principle of the competitiveness and equality of the parties Procedural legislation establishes that the court shall create all necessary conditions and assist parties in the full and objective investigation of case circumstances.

Without documents, which are considered to be the basis of assessments, the taxpayer becomes unable to appeal the assessments, and, accordingly, there is a breach of the principle of the competitiveness of the parties and equal access to case materials.

Principle of taxation certainty Pursuant to tax legislation, the principle of taxation certainty is that the basis and procedure for tax obligation shall be defined and established by the laws of the Republic of Kazakhstan.

Meanwhile, the use of information inaccessible to the taxpayer violates the principle of taxation certainty as the taxpayer is not aware of the information used by the tax authorities during tax audits and is unable to confirm or dispute it.

Parties' rights P.1 of Article 47 of the Civil Procedure Code of the Republic of Kazakhstan defines a list of...