$63 million Lost in Tax Reform Challenges

The suits citing unconstitutionality presented in Guatemala against the tax reform have caused irrecoverable losses to government coffers.

Wednesday, February 20, 2013

The head of Collection at tax authority SAT said that " the reform does not only include income tax (ISR)" and noted that the Constitutional Court (CC), among other resolutions, suspended the collection of a 5% tax on the first registration of tractors (Iprima).

"According to the Central American Institute for Fiscal Studies (ICEFI), challenges citing unconstitutionality were filed against 77 articles of decrees 4-2012 (Tax Administration Strengthening Act II) and 10-2012 (Tax Update).

So far, the CC has decided to provisionally suspend four articles and declare one to be unconstitutional, so as to leave income tax payment on pensions and retirement ineffective", reported Elperiodico.com.gt.

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Guatemala: Articles Suspended in Anti Evasion Act II

July 2013

The Constitutional Court has declared unconstitutional three articles of the Tax Code, which empowered the Tax Authority to make adjustments if it detected tax simulation.

S21.com.gt reports: "In Article 31 of Decree 4-2012 the concept of fiscal simulation was added, the aim was that the Superintendency of Tax Administration (SAT) made adjustments when delegates established that taxpayers had concealed the legal status of the business by giving a appearance different to that under which it was registered. "

Guatemala: More Tax Regulations Suspended

February 2013

The suspension by the Constitutional Court of the application of more articles from the Tax Reform Act could cost the state more than $255 million.

The Constitutional Court has provisionally suspended two more articles of the Tax Reform Act. The first is Article 4, which includes as earned income "pensions, retirement funds and widows' pensions, in respect of an employment exercised in the country, paid or credited to any beneficiary who is resident in Guatemala", reported Elperiodico.com.gt.

Business Tax Reclassification Suspended

January 2013

In Guatemala, the Constitutional Court has accepted an appeal filed by businessmen and suspended the application of Article 61 of the tax reform.

Unanimously and provisionally, the Constitutional Court of Guatemala ordered the suspension of Article 61 of the Tax Reform related to reclassification of operations after considering it "patently unconstitutional."

Article in Anti-Evasion Act II Suspended

May 2012

In Guatemala, the justice department has provisionally suspended Article 31 of the Act authorizing the SAT to penalize taxpayers who commit violations of their tax obligations.

The partial unconstitutionality (only against Articles 31 and 50) was requested by the Chamber of Agriculture through its chairman, Otto Kuhsiek, on 9th March. The Bar Association also filed an action before the Constitutional Court in the same vein.