El Salvador: Reforms to Income Tax Rejected

The private sector has rejected the FMLN’s proposal to reform income tax law.

Thursday, November 17, 2011

Jorge Daboub, president of the National Association of Private Enterprise (ANEP in Spanish), said the proposal is not based on a deep technical analysis of the subject. The first action that should be performed is to correct the "waste of Salvadorans’ tax dollars."

"Daboub believes that the proposed 0.8% tax that is to be applied to the gross income of companies is a new tax that punishes employers who have been affected by the economic crisis.

The president of the Chamber of Commerce, Luis Cardenal, said that this 0.8% will cause business closures and unemployment."

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Government Changes Technical Agreement on Tax

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Guatemala's business associations are asking for explanations about the government's decision not to accept the changes already agreed on by a bipartisan technical committee.

"Andres Castillo, president of the Committee of Commercial, Industrial and Financial Associations (Cacif), explained that the technical committee formed by the Ministry of Finance, the Tax Authority, the Vice President and the private sector" reached agreement on 28 items which were drafted with the preamble, "which were rejected by Perez Centeno", reported Siglo21.com.gt.

Free Zones Law Reform in El Salvador

February 2013

Companies starting operations in free zones outside the metropolitan area will be fully exempt from income tax for 15 years.

From a press release issued by the Legislative Assembly of El Salvador:

With 82 votes from all of the parliamentary groups, the Legislature approved tonight reforms to the Law on Industrial Free Zones, which according to the ruling, will generate greater certainty and legal security for the productive sector.

El Salvador: Textile Companies Oppose 5% Tax

February 2013

The Chamber of Textile, Clothing Companies and Free Zones states that if the new law on Free Zone included the tax, it would drive away millions of dollars in investments.

Elmundo.com.sv reports that "The Chamber of Textile, Clothing Companies and Free Zones of El Salvador (Camtex) on Wednesday opposed changes made by the Finance Minister Carlos Cáceres to the proposed amendments to the Law on Free Zones, agreed with the sector since October 2011."

Salvadoran Government Readies Tax Reform

August 2009

The reform won't increase value-added nor income tax, but will include measures to control evasion, smuggling and corruption.

The Executive will present Congress the reform project, together with the State Budget on September 30th.

"The tax authority is also evaluating modifying some specific taxes, like alcoholic beverages and some products currently not taxed, like energy drinks", reported newspaper La Prensa Gráfica.

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