El Salvador: Border Tax Repeal Announced

The regional freight sector has agreed to purchase insurance to protect accident victims.

Monday, June 3, 2013

Prensalibre.com.gt reports that "The government of El Salvador and cargo transport unions in Central America, agreed yesterday in "supporting" a legal reform which alleviates them from the payment of a tax on those who already pay insurance to cover against any accidents, an official said. "

Since May 2, the government of El Salvador has charged foreign vehicles passing through the country's borders, a tax known as 'Fondo de Atención a las Víctimas de Accidentes de Tránsito (FONAT)' , which ranges between 10 and 150 dollars. The move sparked fierce resistance with both carriers and Central American Business associations, because of the impact of such fees on the costs of transporting goods.

Now it is the responsibility of the Congress of El Salvador, to amend the law that established the collection of this tax.



More on this topic

Central America: Threats to the Supply Chain

May 2020

Since El Salvador, Costa Rica and Panama have set a 72-hour time limit for freight drivers operating in the region, hundreds of units have decided to halt their operations as a measure of pressure.

Due to the health crisis resulting from the covid-19 outbreak, Salvadoran, Costa Rican and Panamanian authorities decided that the drivers of the cargo transport units entering the country will have only 72 hours to make the formalities at the borders, and to unload and reload the goods from the vehicles.

Carriers Prepare Lawsuit Against El Salvador

January 2014

The regional union is bringing charges to the Central American Court of Justice over what it considers to be undue customs fees in El Salvador.

The American Federation of Freight (Fecatrans) announced that it is preparing a lawsuit against El Salvador at the Central American Court of Justice (CCJ). The union is complaining about the fees that carriers pay at customs offices in that country, which it considers improper.

New Tax at El Salvador Borders Still In Effect

June 2013

The Federation of Chambers and Associations of Exporters of Central America have joined their voices with those of businesses to oppose the tax for Attention to Victims of Traffic Accidents.

The Federation of Chambers and Associations of Exporters of Central America (Fecaxca) believes that the tax affects the competitiveness of a regional market in the process of development.

Agricultural Chambers Against Border Tax

May 2013

Complaints have been made stating that the new tax charged by the government of El Salvador on vehicles from other countries who cross its borders, will increase costs and hinders regional trade.

The Salvadoran decision "is detrimental to the competitiveness of the Central American region, further increasing costs related to insecurity, and this measure goes against the principal of free movement of goods in the region," said the Federation of Chambers of Agriculture and Agroindustrialists in Central America (Fecagro).

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