It is no secret that the country's fiscal panorama is delicate and requires immediate actions to improve tax collection. This situation is not new, and, in fact, it has been a constant in Colombia during the last few years, which is why tax reforms have been intensively presented during the last two presidential terms.

Finances in Colombia today are also in the intensive care unit. Hence, for the National Tax and Customs Directorate (Dian) and the State authorities, the number one priority is to recover the money not declared by taxpayers.

In countries such as Mexico and Spain, the criminalization of tax evasion has already been used to encourage the payment of taxes that taxpayers fail to pay irregularly. Regardless of the discussion on whether this translates into an expansionist phenomenon of Criminal Law, which is indeed the case, the fact is that in other countries these strategies have served to put several taxpayers in irregular situations in jail, demonstrating the effective success of this harmonization between criminal and tax law.

The most recent tax reform, Law 2010 of 2019, implemented this same public policy and resorted to criminal law as a collection mechanism. This implies a rethinking of tax litigation in Colombia, in which it is necessary to resort to stricter preventive strategies and defense strategies with technical knowledge that harmonize criminal and tax matters.

Article 132 of the aforementioned reform created the Specialized Directorate against Tax Crimes and assigned it a staff of 30 prosecutors, 45 professionals and 50 technicians specialized in the areas of taxation, finance and accounting. With this interdisciplinary structure, a robust work team is created to start the prosecution of all evaders, although, as Professor César Cermeño, partner of DLA Piper Martínez Beltrán, warns in the development of its auditing processes, it is also feasible that serious taxpayers who may have committed simple formal errors or who have differences of criteria with the tax authority may be investigated.

In the Attorney General's Office, in turn, very recently Resolution 00720 of April 15, 2021 was issued through which the knowledge criteria are assigned to determine which cases will be assumed by this directorate. Among them, the following stand out:

a) Omission of assets or inclusion of non-existent liabilities and tax fraud or evasion regardless of the amount

b) Omission of withholding or collection agent when the amount is equal to or greater than 350 monthly minimum wage

c) Fictitious export or import, tax evasion, aggravated fraud, unlawful exercise of monopolistic activity of rent arbitrage, use of treasury resources for the encouragement or undue benefit of precious metal exploiters and traders, subsidy fraud, when the amount exceeds 300 monthly minimum wage

d) Other crimes related to tax evasion phenomena that indicate the existence of tax fraud schemes.

These activities, in addition, have a joint work advanced between the Dian and the Prosecutor's Office through inter-institutional tables in which progress has been prioritized with these originally fiscal investigations, but with clearly criminal consequences.

This is how we are facing a new and complex reality of tax litigation in Colombia. The country is putting everything at stake to recover the taxes evaded by taxpayers, mainly in the areas of VAT and income (although the criminal type of tax fraud would also involve aspects related to territorial taxes, which will make the situation even more complex and stressful for some companies). All in all, the objective is to overcome the fiscal deficit.

The Attorney General's Office has been assigned the important function of being the 'chepito' of the State to help in this enormous task and it is now up to the companies to be more careful than ever to avoid sanctions and jail for seeking 'savings' in their taxes. It is necessary for businessmen to seek preventive correction and payment alternatives and to seek legal advice to avoid problems that inevitably have more serious consequences.