The Provincial Court of Madrid has sentenced a businessman to two years in prison for four crimes against the Public Treasury, after evading 1,121,424 euros in taxes through two fictitious headquarters in the Canary Islands, one of them in Lanzarote. Likewise, he has been imposed fines for a total value of 560,646 euros and the obligation to compensate the Treasury with the amount he defrauded.
In a ruling issued on January 25 - which is not yet final and has already been appealed - the Chamber considers it proven that the accused, partner and sole administrator of Least Cost Routing Telecom, a company dedicated to the provision of telephone services created in Madrid in 1999, "artificially established in the Canary archipelago" two companies, one of them in Tenerife and the other in Lanzarote, specifically in Costa Teguise, which he used "indistinctly" in order "not to pass on VAT" with "fraudulent intent".
And it is that, "through the aforementioned simulation he stopped paying said tax, being subject only to the IGIC when domiciled in the Canary Islands, serving for this purpose the aforementioned Least Cost Routing Telecom that, although it had its address in Madrid, "provided telephone resale services without invoicing VAT". In this way, the now convicted person caused damage to the Public Treasury between the years 2007 and 2010 of a total of 1,121,424 euros.
A company "at an address where it has never been located"
In the case of the company that was established in Costa Teguise under the name of Least Cost Routing Canarias, the ruling indicates that it declares its registered and fiscal address "at an address where it has never been located". "The owner of the address declared by Least Cort Routing Canarias, SL denied that the entity had ever had its fiscal address or had carried out its activity at said address", the ruling points out.
It also states that, according to a report by a tax agent, he went to said address "in order to notify the communication of the start of the actions indicating that it is a two-story single-family home", without "any type of identification" and whose owner stated "not to have anything to do" with said company, showing "at the same time his discomfort for the correspondence that arrives at his address addressed to that company and that he returns to the postman".
After this, and at the request of the actuary, it is indicated that on June 15, 2010, the change of address to Arrecife was communicated to the Tax Agency. However, "on October 7, 2011, the declared fiscal address was verified again, resulting again unknown at said address, as stated by the tenant of the house", the ruling states.
In addition, it is pointed out that the representative of Least Cost Routing Canarias recognized as the company's address the office that the accused has in Madrid. A recognition that "implies that Least Cost Routing Canarias, SL has and has had its true address in the territory of application of VAT", in the opinion of the court, which has convicted the accused as the perpetrator of a total of four crimes against the Public Treasury, imposing on him for each of them a sentence of six months in prison.
Extenuating circumstances of undue delays and reparation of damage
However, when imposing the sentence, the extenuating circumstance of undue delays has been applied, since the proceedings began in January 2012 and the trial did not take place until January 2019, as well as that of reparation of damage, since the accused consigned the amount of 425,000 euros ten days before the trial.
Even so, the ruling also imposes four fines for a total value of 560,646 euros and condemns him to compensate the Public Treasury "for the damages caused" with a total of 1,121,424 euros, which was the money he defrauded. Said amounts "will be increased in all cases by the legally foreseen interest", adds the ruling, in which the accused is also condemned to pay the procedural costs.
