A Valencia court annuls a penalty imposed by Spanish tax Agency (AEAT) on a company for infringing the financial legislation on cash payments
The Contentious-Administrative Court no 3 of Valencia has granted appeal to a company which had been fined for infringing the financial legislation on cash payments. Precisely, in judgment no 76/2021, of February 25, 2021, the court holds that the elimination of cash for transactions exceeding €2,500 in which a business or professional is involved, under Law 7/12 of November 29, cannot be applied across the board.
It was interpreted in that manner in a case where the sanctioned company by the AEAT recived in 2017 a check to bearer in the amount 200,000 euros, as part of the total amount of 3.3 million euros for the sale of 36 commercial premises located in a building in Benidorm.
The magistrate-judge points out in the sentence that, as it is "a payment made by means of a bearer check, drawn on an account of the payer", Law 10/2010, of April 28, on the prevention of money laundering and financing of terrorism, already establishes specific provisions for its supervision and control (identification, knowledge of the clients, conservation, etc.), thus contributing to control and avoid tax fraud as well. Thus, the appeal was upheld by the court, understanding that the absolute prohibition, under penalty of sanction, of operations whose payment is made by means of bearer bank securities, "constitutes an unnecessary and disproportionate measure for the purposes of controlling tax fraud, and that it is opposed to the general principle of acceptance of the euro as legal tender".
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