All imports are subject to the random selection mechanism that will determine whether or not the goods should be inspected, or subsequently verified through corresponding customs investigations or audits, which will then lead to a successive administrative challenge process before the General Directorate of Customs Services (DGA).
In principle, art 64 of Law No. 265 “Law that Establishes Self-Dispatch for Imports, Exports and Other Regimes”, amended by art 24 of Law No. 421 “Customs Valuation Law”, regulates the administrative fines that are applicable for administrative infractions, which are classified into those that cause fiscal damage and those that do not cause fiscal damage to the Customs Administration.
For administrative violations, a fine equivalent to 100% of the tax damage caused will be applied in those cases in which the taxpayer’s action causes a tax damage. In other words, in those cases in which the Customs Administration determines omitted taxes on import or export of goods and merchandise, it may apply a fine of 100% of the omitted tax to the taxpayer.
By virtue of the above, we have identified that recently the customs authority after its verification process, by which it was determined that the total of the goods have not been declared or that the same have not been properly documented, they are directly notified a fine for a customs offense, because these cases are typified as a crime as contemplated in Law No. 641 “Penal Code of the Republic of Nicaragua”, these refer to the following:
1) Customs Fraud.
3) Customs fraud and minor smuggling.
In the first case, which refers to customs fraud for the total or partial evasion of import or export duties and taxes on goods and merchandise whose value in cordobas exceeds an amount equivalent to one hundred thousand Central American pesos, any act tending to defraud the application of the established tax charges shall be punished with three to six years imprisonment and a fine equivalent to double the value of the goods or merchandise involved.
The second case refers to smuggling, and is committed by whoever with the purpose of evading totally or partially the payment of import or export duties and taxes on goods and merchandise whose value in cordobas exceeds an amount equivalent to one hundred thousand Central American pesos, illegally introduces, disposes, maintains or extracts them from the national territory, shall be punished with four to eight years of imprisonment and a fine equivalent to double the value of the goods or merchandise involved.
Finally, the third case refers to customs fraud and minor smuggling, when it is intended to totally or partially evade the payment of duties and taxes in the import or export of goods and merchandise whose value is greater than five thousand and less than one hundred thousand Central American pesos, depending on whether it is customs fraud or smuggling, it will be sanctioned with a fine equivalent to double the value of the good or merchandise introduced or exported.
We have observed some cases in which the Customs Administration is subjecting importers to a prior process with the purpose of applying a fine equivalent to double the value of the goods or merchandise introduced or exported, that is, 200% of the value of the goods or merchandise.
Note that these penal provisions are being applied rigorously and equally in all cases, regardless of whether or not there was an intention to evade or avoid the customs tax burden, since they do not even give the opportunity to demonstrate whether the importer/taxpayer acted fraudulently to evade customs duties and taxes.
Therefore, we recommend all importers/taxpayers to previously review the goods before entering the customs area, verifying compliance with their internal procedures for importing and exporting goods and merchandise, in order to avoid fines or tax adjustments, as well as the indiscriminate application of the Penal Code. Likewise, it is important to take preventive advice on tax and customs issues for the review of your processes and compliance with legal requirements, in order to be prepared for a possible customs domiciliary audit and/or receive notification of a report of findings that determines a customs adjustment.