1. Speech by Dr. Marcus Desax, President of IFA - International ...

Opening Ceremony 63 rd IFA Congress, Vancouver,
30 August 2009
Speech by Dr. Marcus Desax, President of IFA
Welcome to all of you to Vancouver, the venue of the next Winter Olympics. For once tax
is citius than the athletes, while no opinion is expressed, of course, as to altius and fortius.
Let me start by taking a representative vote of the IFA membership: Suppose you are the
President of the International Fiscal Association. You have the privilege of sitting on a
Panel with the Finance Minister of a major country and a laureate of the Nobel Price in
economics. You are given the choice of speaking before or after them. Who would like to
speak after these gentlemen? ______ Who before?________
Obviously, before them! What can the IFA President possibly say after two such eminent
persons? I am thankful to Brian Schneiderman that he has spared me this embarrassment
and has allowed me to start first.
This is already my fourth address at an Opening Ceremony and therefore my last one.
When I addressed you for the first time 2006 in Amsterdam, to promote the Young IFA
Network (YIN) I sang a few lines out of the Beatles’ song “When I’m sixty-four”. Don’t be
afraid, I won’t sing again. Some of the crazy things that you used to do as a youngster you
will not do any longer when you are older and wiser. Actually, my reference to the 1967
Album “Sgt. Pepper’s Lonely Heart Club Band” was not primarily to appeal to the young
members of IFA. Rather, it was meant to remind the older ones that something had to be
done to make IFA more attractive to younger members and to offer them opportunities in
our Association.
Introduced in 2005, YIN has established itself firmly at the international level: last year, a
member of the PSC was on maternity leave and the new IFA President whom we shall
elect this Thursday, is not yet 50 years old. Both would have been unthinkable twenty
years ago and even less.
Young IFA members play an important role in the Permanent Scientific Committee, in the
Executive Committee and in an ad hoc Strategy Committee. I am also pleased to see the
special activities destined to younger IFA members at this Congress; they show our
eagerness to make our scientific Congress also attractive to young members.
Many IFA Branches have favourably accepted our wish to have YIN representatives on
their national boards and to have special activities where younger members can make a
contribution. There are still a few Branches where there is room for progress. As an
example, I may refer to the composition of the IFA General Council, whose members are
nominated by the Branches:
Out of the 161 Members and deputy members of the General Council who served in 1999,
44 are still in function today. From these 44, 10 served already twenty years ago. This is
not very much of a rejuvenation.
The example shows that some of our Branches have still efforts to make to promote
younger members. I recall our former Secretary General Maarten Ellis saying that some

highly deserving IFA members are like large trees in a forest: while they provide for shade
and protection against rain, storm and snow, they do not allow new trees to grow
underneath.
After YIN, the first priority of my Presidency, let me address the second one: the
relationship of tax authorities, taxpayers and tax advisers.
In July 2009, your Secretary General and President were invited by the Intra-European
Organisation of Tax Administrations to its 13th General Assembly. IOTA is a non-profit
intergovernmental organization, which provides a forum to assist its 43 members in
Europe to improve tax administration. At this occasion, IFA and IOTA signed a
memorandum of understanding for the future cooperation of our two organisations.
At this meeting, the Swedish Tax Agency gave a presentation on the relationship between
the tax gap, on the one hand, and the perception of the tax officials by taxpayers, on the
other hand. The tax gap is the difference between the amount of tax that would have been
levied if all those liable to the tax reported all their activities and transactions correctly and
the amount of tax actually paid.
The Swedish Tax Agency had undertaken two studies: the one on the tax gap in Sweden
and another one on the way Swedish citizens and businesses perceive the attitude that
the tax officials have towards them. The Tax Agency wrote:
We use risk models, exchange of data, selections systems to target
taxpayers for audit activities; but it’s not enough: we need more
knowledge about what affects behaviour and what increases
voluntary compliance.
According to the Swedish Tax Agency, one of the reasons for which people pay their
taxes and refrain from evasion is the trust in the tax officials. In their study, one of the
questions was: “Would you evade tax if you had the possibility?” Out of the people who
said that they trusted the Tax Agency, 12% answered yes, they would evade the tax, if
they had the possibility. In contrast, in the group of people who said that they did not have
trust in the Tax Agency, 27% said that they would take the opportunity and avoid the tax if
they only could.
The trust in the Swedish Tax Agency was found to be based on the way the tax officials
treat their taxpayer: If the attitude is:
helpful,
listening and cooperative, and
based on the assumption that most people are honest,
the impact of the trust in the Tax Agency is positive.
However, the impact on the trust is negative, if the position of the tax official is:
indifferent, serious, going by the rules,
insensitive, superior, exercising power and accusatory, or
even worse, if it is based on the belief that most people are dishonest.
The Swedish Tax Agency is not the first one to claim that the relationship between tax
authorities, taxpayers and tax advisers should be improved. In January 2008, the OECD
published its “Study into the Role of Tax Intermediaries”, in May 2009 “Building
Transparent Tax Compliance by Banks” and “Engaging with High Net Worth Individuals on
Tax Compliance”. The OECD proposed to build on an “enhanced relationship” between all

players in the tax field.
Our Executive Committee has also discussed the matter. While determined to stay away
from political discussions, it is of the opinion that the focus should be on existing
legislations and on the right to plan one’s tax affairs within the local system. IFA considers
launching the debate which could centre on the following basic principles:
No tax without a law!
Taxes prescribed by law should be levied and paid.
The law should be clear; if it is unclear, taxpayers should receive guidance:
Taxpayers may rely in good faith on the law – which means limited scope for
retroactive effect and, except in cases of abuse, sufficient lead time for policy
changes and legal amendments).
The right to plan one’s tax affairs within the scope of the law should be
recognized.
Taxpayers should honestly disclose their tax affairs.
Tax authorities should have the right to check compliance.
The audit behaviour should be proportionate to the levels of good faith and
disclosure by the taxpayer.
A differing treatment may be afforded to fully disclosing taxpayer, normal
taxpayers or bad-faith taxpayers.
Tax matters should be resolved within a reasonable time frame
It is obvious, while these principles can, and in my opinion should, be discussed at the
international level, the concretisation and the implementation must be done nationally. I
therefore invite the IFA Branches to set the matter on their agendas. Who is better
qualified for this endeavour than IFA with its diverse membership of tax officials, tax
advisers,academics, judges and corporate tax people?
Our Association continues its scientific works in many different areas. At this Congress,
besides the two main Subjects, we have a total of fourteen seminars, which is a new
record. It is not possible to go into the details of the discussions. Let me just thank the
many, many people who have been instrumental in setting up the scientific part of the
Congress.
I would also like to thank the organisers of this Congress. While they had the advantage of
hosting a Congress in one the of the World’s most beautiful cities, the economic crisis and
the swine flu could have been a serious threat. Nonetheless, ____ participants and ____
accompanying persons have registered – a tribute to the organisers led by Albert Baker
and Robert Raizenne.
During my Presidency, we replaced the Secretary General, the Chair of the Permanent
Scientific Committee, the General Treasurer and the Manager of the General Secretariat.
If, in a company, all senior managers leave except the CEO, there is usually something
wrong with the latter. But, please believe me, they all had their objective reasons. I would
like to mention here how much I liked to work with the Secretaries General Maarten Ellis
and Han Kogels, the Chairs of the PSC Jean-Pierre Le Gall and Robert Couzin and with
the General Treasurers Jan van der Bijl and Jos Beerepoot. I appreciated the assistance
and kindness of the managers of the General Secretariat Nel Slingerland and Thea van
Dijk and the continuous support from the ladies at the Secretariat General, Nathalie Spruit,
Anja van Zwietering, Marga Vink and Margareth Barten. Thank you for your support, your
good cheers and your friendship.

I would like to close my address by saying that I am proud and glad to hand over the
Presidency of IFA to Manuel Tron of Mexico. Although a tax practitioner, Manuel served
for ten years on the Permanent Scientific Committee where his contribution was widely
appreciated. He is not yet fifty years old and is the first IFA President that does not come
from Europe or the USA. His dedication, his youth and his origin will open new
perspectives to our Association. I wish him success and as much pleasure I had and still
have this week of working with you.
With this bright outlook, I declare open the XXIst Winter Olympic Games ... - gosh, I'm too
early! – I declare open the 63rd IFA Congress!