Justice endorses the Treasury sanctions in opposition to rapper Mala Rodríguez for a debt of 100,000 euros | Economy | EUROtoday

Justice reinforces its doctrine on the usage of skilled societies, particularly within the inventive area, to channel revenue and scale back the tax burden. The Superior Court of Justice of Catalonia (TSJC) has lately endorsed the inspection and sanctions for a debt near 100,000 euros that the Tax Agency imposed on the Spanish rapper María Rodríguez Garrido, generally known as Mala Rodríguez, for utilizing her firm “as a vehicle for mediation and billing of the professional activities that the artist carries out in her own name and person.”

The Tax Agency, which has been specializing in artists, athletes and celebrities for years, notified the Cádiz singer in June 2020 of the opening of two inspection procedures in relation to the private revenue tax (IRPF) and the company tax comparable to the years starting from 2015 to 2018. Both recordsdata concluded settlement agreements and sanctions for not paying installments totaling 99,993.69 euros. (13,835.29 euros for the 2018 company tax and 86,158.40 euros for the 2017 private revenue tax).

Rodríguez challenged each agreements earlier than the Regional Economic Administrative Court of Catalonia (TEARC) – a physique depending on the Ministry of Finance in command of resolving claims relating to tax acts -, which confirmed the inspection motion in May 2023. Once the executive route was closed, the artist started the judicial course of earlier than the Superior Court of Justice of Catalonia, which has additionally validated the standards of the Tax Agency.

In two rulings handed down on December 2 – in opposition to which an attraction will be made to the Supreme Court – the Catalan excessive court docket believes that the taxation carried out by means of the corporate Maruska La Maga, 100% owned by Mala Rodríguez since its creation, was not appropriate. Specifically, the controversy focuses on the billing {of professional} exercise by means of this firm and the deduction of sure bills.

Jurisprudence signifies that the usage of skilled corporations to channel revenue is legitimate so long as there’s a actual construction, that’s, when there are personal materials and human sources. In this regard, the appeals filed in opposition to the Treasury state that Maruska La Maga supplies its personal “added value”, based mostly on the group of auxiliary sources reminiscent of technicians, musicians, choristers or different professionals, in addition to the existence of fabric and administration parts.

However, the court docket doesn’t assume the identical. According to the resolutions consulted by this newspaper, Rodríguez’s firm acted as a “mere administrative channeling structure.” The magistrates emphasize that Maruska “does not use its own brand that the public identifies as an autonomous proposal” for the promotion and advertising of Mala Rodríguez’s exercise, and concludes that “commercial success” relies on the “identity of the artist, his career, public notoriety and professional capacity.”

“The image, voice, style, stage presence and artistic reputation of the individual are the elements that determine the economic value of the service. The hiring of a concert or performance does not depend on a different corporate asset, nor on a list of material or human resources.” […]. The public hires the artist immediately, in order that the corporate features as a mere authorized construction of administrative, organizational and monetary channeling, missing enterprise autonomy in an financial sense,” the sentences clarify.

“Hidden remuneration”

Under this premise, the court docket additionally ratifies the Treasury’s standards that the singer obtained “property advantages.” The inspectors disagree with the market worth that Maruska La Maga declared for the providers offered by the Spanish rapper. According to the sentences, the corporate deducted from the revenue obtained by Mala Rodríguez’s providers these bills derived from the group of the occasions and collaborations and paid the distinction to its associate. But as a result of the Administration considers that the corporate is an instrumental automobile, the magistrates agree with the Treasury that the actual market worth that ought to have been declared is the ultimate worth they cost for these “very personal” providers. Thus, they agree that these incomes ought to be thought-about “disguised remuneration.”

This is likely one of the tax methods that the Treasury intensely pursues, particularly in circumstances of public figures, to keep away from tax avoidance, since revenue is asserted by company tax as an alternative of private revenue tax, which has greater tax charges.

Another level of debate is the deduction of quite a few bills, declared by each the patrimonial firm and the artist of their private revenue tax. The TSJC additionally helps the Treasury’s place, contemplating that a lot of these things reply to non-public or household bills and will not be associated to financial exercise. These embrace ideas reminiscent of “costumes not specialized in shows, aesthetic treatments, the family transportation card, maintenance not associated with accredited travel or transportation expenses without justification of destination and reason,” based on one of many judicial resolutions.

On this level, the court docket insists that it’s as much as the taxpayer to display the connection of mentioned bills with the corporate’s exercise to justify their deductibility. In this particular case, he provides, the artist has not offered enough proof to show that these weren’t personal or household bills.