Nicaragua announces tax reform
The Government did not provide details on how it plans to modify the tax collection system, but made the commitment to the IMF that it will increase revenue from tax collection.
Tuesday, August 26, 2008
Tax law expert, Julio Francisco Báez, said that the reform will not only seek to increase collection, but to stimulate investment and eliminate anti-exporter biases. Bayardo Arce, Presidential Economic Advisor, spoke of removing tax exemptions from various sectors as they are considered to be "excessive."
A so called "tax pact" will be hurried by the Government, after pressure from the International Monetary Fund.
Exemption from VAT and income tax for SMEs operating under the fixed quota regime will be retained in the Tax Act Coalition whose reform is being proposed by the Executive.
Agricultural companies stated their concern in the first meeting they held to analyze the Government's proposal.
The business sector and the Government agreed to the postponement of the tax reform for two years in order to stimulate productive activity.
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