El Salvador: Changes Promised in Tax Reform Bill

The government has agreed to modify the terms of the tax reform proposal to take into account criticisms made by the private sector.

Thursday, May 29, 2014

Salvadoran private companies have outlined to officials the adverse effects that the country would face if the proposed new tax measures were applied, receiving signals of openness to a discussion from the Government, who for the first time since 2009 and 2010 has agreed to negotiate tax reforms with entrepreneurs.

"... After the third meeting held yesterday between the Government and the senior leadership of the National Association of Private Enterprise (ANEP), the president of the business association, Jorge Daboub, said the government promised to take their considerations to the Legislature and schedule another meeting within two days to discuss the issue at a technical level. The government's openness was noted and Daboub hoped that there would be no "surprises" in the coming days.

"Private enterprise ... also presented a number of alternatives which need to be worked on right away, such as economic growth and a fiscal responsibility law. According to Daboub, none of these reforms should be passed in the Legislature since many of them would end up affecting the whole population and some of them even clash with the Constitution of the Republic, he said without elaborating further. "

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ANEP press release:

Regarding the tax increase approved by the FMLN, GANA, PCN and PDC, the National Association of Private Enterprise, ANEP, declares:

1. We lament that the representatives who voted for more taxes care more about what the government offers them in exchange for their votes, than the consequences of causing unemployment and deepening poverty in El Salvador.

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