The amendment to the Tax Code, partially approved by Congress, omits the concept of "global income", and establishes "territorial income".
Latribuna.hn reports that "...The Bill for a new Tax Code was drafted by the government, employers and a sector in the social economy, and during the dissemination it was said that the change to "Territorial Income represents a setback in the fight against capital flight."
Legal tax engineering is a mandatory business practice for anyone who wants to be competitive in today's globalized world, and only those who are not entrepreneurs can afford to refuse to acknowledge this fact.
EDITORIAL
With the same firmness that we criticize businesspeople who evade taxes or bribe officials to get a contract, we must defend every business practice which is framed within the law to pursue the best use of available resources to generate wealth through the production of goods and services, which is what businesses do.
The G20 finance ministers gave full support to the project that would prevent corporate profits from "disappearing" or being artificially transferred to jurisdictions with low or no taxation.
From the press release issued by the G-20:
During a meeting chaired by Turkish Deputy Prime Minister Cevdet Yilmaz, the G20 finance ministers expressed strong support for the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project, which provides governments with solutions for closing the gaps in existing international rules that allow corporate profits to « disappear » or be artificially shifted to low/no tax environments, where little or no economic activity takes place.
Congress has passed the elimination of the provision that payments be made by natural and legal persons when they are shareholders in corporate groups.
According to the liberal congresswoman Gabriela Núñez "... The law is properly applied to individuals who receive dividends as when they receive a profit they must pay their taxes; however, when it relates to a company it becomes a double taxation because the company, when it receives dividends, pays the tax and then when it distributes the dividends among its own shareholders, it once again incurs a tax liability of 10%, which is considered prohibited in the Tax Code. "
The Organization for Economic Cooperation and Development has released a plan for the design of international standards to prevent abuse of rules such as the one that lets companies avoid paying taxes in two countries.
Nacion.com reports that "The secretary general of the OECD, Miguel Angel Gurría, accompanied by the G20 finance ministers, today in Moscow presented an ambitious plan to combat the shortcomings of countries tax systems and halting tax evasion by multinationals. "
An alliance of small territories has been proposed to encourage a discussion with the OECD over financial centers, and bring it to the attention of the United Nations.
An article in Prensa.com examines the opinions of a variety of analysts at the second Step Latam Conference held in Panama, regarding pressure from the Organization for Economic Cooperation and Development (OECD) on countries to comply with their requirements on tax information exchange.
In the isthmus the country with the most financial secrecy is Panama (14 in the list of "opaque jurisdictions"), followed by Costa Rica (41) and Guatemala (42).
Globally Switzerland is top of the list followed by the Cayman Islands, Luxembourg and Hong Kong, all ahead of the U.S. which is in 5th place.
Every year governments around the world lose around 250 billion dollars in taxes, as a consequence of the rich keeping their assets in tax havens.
The country known for its canal is making progress toward its objective to sign at least 12 DTA in order to comply with the OECD requirements and come off the organization's list of tax havens.
Signing double taxation agreements (DTAs) has the added benefit that it may make it easier for the countries with which the information sharing agreements are reached to invest in Panama.
Before the president of South Korea, Panamanian president Martinelli spoke of the isthmus’ privileged geographic location to attract Asian investment.
At the XXXV Summit of Heads of State of the Central American Integration System (SICA), Ricardo Martinelli noted that the region could become the gateway for Korean investment in Latin America. He promoted the development of production facilities from companies like LG, Hyundai and Kia, who already own important commercial operations in the region.
As in Orwell’s fable, Central Banks assume the task of deciding who, among equals, “is more equal than others”.
Paul Laurent Solís analyzed the anathema that has become the label “tax haven”, and remarked the role Central Banks have assumed in Central American economies, especially when they become tools for whichever government that happens to be in power.