El Salvador: Tax Burden to 17% by 2014

The government's goal is to have a tax burden of 17% by 2014 through economic growth and increased taxes.

Friday, March 11, 2011

Currently, the country's tax burden (percentage of revenue compared with the Gross Domestic Product (GDP)) is 14.1%.

Finance Minister, Carlos Caceres, acknowledged the goal may seem ambitious but it is also necessary or otherwise the country has no fiscal viability.

Laprensagrafica.com gathered more comments from the Minister: "We need to have greater contribution through economic growth or taxes."

More on this topic

New Tax Reform in El Salvador

February 2011

The government admitted working on a new tax reform to broaden the income tax and create new taxes.

With regards to new property tax, Finance Minister Carlos Caceres said it would be applied for the 2012 and 2013 fiscal year.

"On tax reform as a whole, the finance minister said they are still working on it, but there isn't anything formal, in any case he indicated that it could jump-start in the first half of this year," noted Elsalvador.com.

El Salvador Businesses Oppose New Taxes

May 2014

The private sector is opposed to the conditions in the third reform package the outgoing government intends to implement, claiming that state expenditures should be reduced first.

More control of public spending and no new taxes are the demands from employers to the government, which aims to increase government revenues with a third reform and the issuance of $800 million in bonds.

El Salvador: Tax Reform to be Discussed with Companies

October 2009

The Government will create a commission to discuss the tax reform project with private enterprises.

Alex Segovia, Technical Secretary for the President, explained that this commission will analyze the proposal, in order to modify aspects that may could affect the country.

More Taxes in El Salvador

July 2013

The third tax bill is now ready; it will tax bank transfers, luxury homes, as well as products used by printing companies.

The Ministry of Finance has not yet said when it will send the plan, which expects to increase revenuea by about $100 million, to the Legislature. According to the chief of Finance, Carlos Caceres, "we are working on the project which will, by 2020, return us to the same pre-crisis debt levels (before 2008).

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