04-07-2011
Public Prosecution Service Settlement Act: the fiscal punishment order

The Dutch Tax Authorities have been granted the power to issue fiscal punishment orders with effect from 1 July 2011. On the basis of this Order the Tax Authorities may impose a penalty on someone accused of a tax offence. The fiscal punishment order not only replaces the out-of-court settlement but it also widens the powers of the Tax Authorities considerably.

The Tax Authorities may issue the fiscal punishment order independently in all cases involving the FIOD-ECD (Fiscal Intelligence and Investigation Service). In such case the Public Prosecutor is competent. The Tax Authorities may impose a fine and claim fulfilment of the tax obligation. Should the accused not agree with the fiscal punishment order imposed, he may object. The Public Prosecutor will then take over the case.

The accused must be heard in all cases involving fines in excess of € 2,000 before the fiscal punishment order can be issued. Before this hearing can take place, the accused must be read his rights. This is because a punishment order issued by the Tax Authorities carries the same consequences as a sentence delivered by a criminal court judge. Consequently, the fiscal punishment order allows the Tax Authorities to act as ‘Judge’ in specific cases.

For more information, please contact Mieke Eversteijn at mieke.eversteijn@vmwtaxand.nl.