El Salvador: Tax Free Cities

The private sector has proposed creating development zones with specific tax laws and tax free status in order to encourage local and foreign investment.

Tuesday, June 24, 2014

Following a concept created by economist Paul Romer and implemented in cities such as Hong Kong, and proposed in Honduras through the passage of a law last year, Salvadoran businessmen are proposing 29 law reforms in order to create development zones which have their own laws to enhance the competitiveness of companies located within them.

"... The president of the National Association of Private Enterprise (ANEP), Jorge Daboub said in lapagina.com.sv that "... the development zones are geographic areas where entrepreneurs invest to promote economic growth .... he insisted that this model has been applied in neighboring countries such as Honduras, but said that they are not seeking to replicate the project, but adapt it to the Salvadoran situation. "

"...Entrepreneurs also proposed to the government a number of legal reforms to breath life into progress zones, including a law on customs procedures, facilitation of procedures, facilities for investment and new regulations which ensure legal certainty for investors. "



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