In the 140th article of the Tax Procedure Law No. 213 (“TPL”), the procedures and principles to be followed by the persons who carry out tax inspections are regulated. In the 6th paragraph of this article, it is stated that the report evaluation commissions shall examine the reports prepared by the tax inspectors and their assistants before they are sent to the relevant tax office for processing. Report evaluation commissions consist of at least three permanent and sufficient number of substitute members to be appointed from among the tax inspectors who have completed ten years in the profession. In the continuation of the article, it is regulated that the tax inspection reports prepared by the supreme tax officer or tax office managers of the province, who are authorized to conduct tax inspections in line with Article 135 of the TPL, shall be evaluated by the report evaluation commissions to be formed in the central and provincial units of the Revenue Administration.
The working procedures and principles of the report evaluation commissions are determined within the Regulation on the Establishment of the Report Evaluation Commissions and the Working Procedures and Principles (“Regulation”). When the provisions of the Regulation are examined, it is understood that the purpose of the report evaluation commissions is to ensure uniformity, efficiency, and coordination in tax inspections. The number of report evaluation commissions to be formed according to the need, and the subject, sector, or taxpayer groups related to the reports evaluated by these commissions, shall be determined by the Tax Inspection Board.
Accordingly, the report evaluation commissions shall evaluate the examination reports prepared by the inspectors and their assistants in compliance with the President’s decision, regulations, general communiqués, circulars, and regulations, and determine whether there are material and procedural errors. At the same time, these commissions are responsible for giving an opinion in which the relationship between the act and the perpetrator is evaluated and the elements of the crime related to the tax crime reports that determine that the tax evasion crimes specified in Article 359 of the Tax Procedure Law have been committed.
The commissions convene with the full number of members and take decisions by majority vote. It has been regulated that the commissions shall evaluate the tax inspection reports within 60 days from the delivery of the reports to them.
Suppose the tax inspection reports are found in accordance with the legislation by the report evaluation commissions. In that case, the decision report shall be forwarded to the relevant unit, and this unit will send the reports to the relevant tax office. If the tax inspection reports are not found per the relevant legislation in the evaluation made by the report evaluation commissions, the reasoned decision report shall be sent to the inspector via the relevant unit. If the inspector agrees to evaluate the report evaluation commission, the tax inspection report shall be redrafted in line with the commission’s recommendations.
If the inspector disagrees with the evaluation result, he/she shall notify the reasons in writing to the report evaluation commission with the reasons. Suppose the report evaluation commission does not accept these justifications and a dispute arises between the commission and the inspector who conducts the examination. In that case, this dispute shall be evaluated within the “Central Report Evaluation Commission” (“Central Commission”), which is the top evaluation authority for tax inspection reports and shall be formed under the Tax Inspection Board. Tax inspection reports to be prepared following the results of the assessment made by the Central Commission shall be forwarded to the relevant tax office for processing. In addition, if the assessment proposal in the tax inspection report exceeds 10 million TL, the report shall be evaluated directly by the Central Commission. It is stated that this amount shall be increased each year at the revaluation rate determined under the law.
Hearing for Taxpayers by Report Evaluation Commissions
In the 14th article of the Regulation, it is regulated that the commissions can listen to the taxpayers or the inspector when they deem necessary or upon their request. The commissions shall give the taxpayers the summaries of the reports containing information about the issues subject to criticism in the reports before the hearing.
This article gives taxpayers the right to speak in front of the report evaluation commissions, which are the interim evaluation authorities for tax inspection reports and enable them to submit their statements about the issues they think are justified. It also ensures that the taxpayers can take an active role in preventing erroneous assessments by pointing out procedural deficiencies and material errors. Thus, the taxpayers will express their claims in front of the commissions before the tax assessment is made yet and ensure that the errors are eliminated in the administrative process.
How Can Taxpayers Use Their Right to be Heard Before the Report Evaluation Commission?
In Article 17 of the Regulation on Procedures and Principles to be Followed in Tax Examinations, which is issued under the TPL, “The statement regarding whether taxpayers have a hearing request before the Report Evaluation Commissions” is counted among the elements should be included in the tax inspection reports. Accordingly, taxpayers should clearly state in the report drawn up after a tax inspection that they have requests to be heard in the report evaluation commissions.
Thus, by taking an active role in the process, taxpayers will be able to explain the sector-oriented details and points of the inspection in front of the tax officers. Also, by actively participating they will be able to clear up the question marks by explaining in detail some complex relationships brought by the sector structure before the tax assessment. In this respect, it is concluded that the taxpayers’ use of their right to be heard in report evaluation commissions favours the taxpayers, the administration, and the judicial authorities.