Leading Adviser Awards 2020

Acquisition International - Leading Adviser 2020 85 Acquisition I ternational - Issue 1 1 47 Oct20810 Obituary – Taxpayers’ Rights No Longer Exist Words by Chartered Global Tax Advisor Dr. K. Olsen. t is with great sorrow that we wish to announce that taxpayers’ legal rights no longer exist. For several thousand years taxpayers’ legal rights have been the most important mainstay of our legal system and have ensured that taxpayers have received professional and correct tax assessment. Even the pharaohs in Ancient Egypt around 3,000 years before Christ were keen to safeguard the taxpayers’ right, as they demanded that their tax collectors, the so- called Scorpios, should be honest and treat taxpayers with respect. Unfortunately, it has now become more important to impose as much tax as possible and to transfer the risk of serious incorrect assessment by the tax authorities to the taxpayers – a development which is disturbing. To put it in another way, when the mainstays of the legal system start to rot, there is a risk that the whole structure will come tumbling down. This obituary is based on the fact that we have seen the taxpayers’ rights being eroded over a period of several decades. One example of this relates to one of our international clients who has been fighting for justice and correct assessment for almost ten years - and is still fighting. Unfortunately this is a case in which the tax authorities committed errors which were particular serious and were responsible for all conceivable types of mistakes: appeals were ignored for several years; the Tax Treaty was misunderstood to the detriment of the taxpayer; a number of procedural errors and breaches of the law were committed; the taxpayer’s arguments were ignored; mistakes were made by new tax officers; and several tax officers lacked any knowledge about international tax legislation. Worst of all; the taxpayer’s tax assessment was not subjected to any quality control – the taxpayer had absolutely no legal rights. When the tax authorities were forced to acquiesce and admit their mistakes, we thought that the taxpayer’s legal costs would be covered, but unfortunately the tax authorities have denied all responsibility and are claiming that the taxpayer should bear most of the risk for their incorrect assessments over many years. It is a very dangerous development when the taxpayers have to bear all the risks involved in incorrect assessment on the part of the authorities. It is not worthy of a constitutional state when a taxpayer’s statutory rights are ignored, and he then has to bear most of the risks involved in the authorities’ incorrect assessment. This whole case was a huge embarrassment. There were actually 150 contractors who lost their statutory rights as well. The company and the contractors were subjected to double taxation for many years; they were unfairly blacklisted by the tax authorities while the tax authorities sat back and procrastinated about their appeals; they had to spend close to EURO 200,000 on legal advisors because the Tax Administration refused to cover such; the contractors lost all their work because the tax authority incorrectly I claimed that they owed tax; they lost the entire basis for their business thanks to the lack of knowledge and respect displayed by the tax authorities; and more than 150 jobs were lost. Their confidence in the tax authorities evaporated and the company’s management have said that they never thought that it would be possible to be so entirely without any rights. The tax authorities literally ‘liquidated’ the company and the contractors and at the same time they dealt the death blow to their legal rights. The undersigned has a unique international tax background and this case is one of the worst and most scandalous tax cases I have ever seen. Unfortunately, the risks involved in engaging in business are too high for taxpayers. Have the legal rights of taxpayers drawn their last breath? May taxpayers’ rights rest in peace. Their confidence in the tax authorities evaporated and the company’s management have said that they never thought that it would be possible to be so entirely without any rights. Leading Taxation and Anti-Corruption Lawyer of the Year, N rway