In 2010, the state granted exemptions and incentives worth $ 23.4 million to exporters, mainly through Tax Credit Certificates (CAT in Spanish).
A total of 1359 CAT were endorsed for $18.9 million, relating to exports in 2009. This mechanism was halted at the end of that year, for being incompatible with standards set by the World Trade Organization.
Between July 20 and 21, the Government of Panama would deliver the first Euro Certificates to agricultural exporters.
The Euro Bonds or Euro Certificates were created seven months ago, after the country was excluded from the EU's Generalized System of Preferences (SGP-Plus). They can be used by agricultural exporters to pay taxes and to request credit at banks, among others.
Agro-exporters are not using Euro-Certificate alternatives because they consider that the "procedure is complicated."
The president of the Panamanian Association of Exporters (APEX), Max Gallardo, said that delays in issuance and indirect costs cause many exporters to bear the cost of the loss of EU tariff preferences.
The union of non-traditional agricultural exporters (Gantrap) indicated that the Euro-Certificate regulation does not guarantee a total refund.
Francisco Antúnez, Gantrap representative told Prensa.com: "Currently, the Euro-Certificate is paid based on the tax of the sale price in the international market, and it should be based on the actual value that is charged and documented on the receipt that is issued by the European Economic Community (EEC)...there could be an incorrect refund on a receipt done by the exporter when what is taken into account is what the EEC charges. Regarding this issue, there are different systems in Spain, England and Holland."
More or less, these documents affect those that seek compensation for the losses incurred by exporters due to the tariff preferences of the EU.
Upon the Panamanian government not having completed on-time the necessary procedures for the renewal of the SGP Plus as established by Europe, Panamanian exporters lost this benefit and were left at a disadvantage against competitors from other countries who continue to enjoy those preferences.
The purpose of the law which creates the eurocertificates (eurobonds) is to compensate the loss of preferential tariffs with the European Union.
Prensa.com reports: The eurocertificates will function as tax bond certificates (CAT) as they will be used to pay taxes, and they can also be used to carry out the transfers that currently take place in the market. For example, this will allow exporters to use them to get financing from banks.
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