Guatemala: Court Ruling Against Tobacco Tax

The Constitutional Court ruled in favor of an appeal by British American Tobacco, alleging double taxation.

Monday, October 18, 2010

The decision, by the highest court in Guatemala, repeals the second paragraph of Article 27 of the Tobacco Law which sets the basis for calculating the tax at no less than 46% of retail price.

The constitutional claim brought by the tobacco company noted that tax calculated on that basis, had "double taxation", since tobacco also pays value added tax.

More on this topic

Costa Rica: NO to Tax Collection Without Firm Ruling

September 2016

A declaration of unconstitutionality has been given to the section of the tax code that allowed the Treasury to demand payment of penalties and interest allegedly owed on taxes before the right to a defense can be exercised.

The slowness and inefficiency with which the Taxation department processes tax disputes, sometimes involving decades before there is a resolution, led to the outlandish idea on the part of lawmakers of putting the cart before the horse.  In order to solve the problem of stubborn evasions where people take advantage of the inefficiency of the Taxation department, a decision was made to take away from companies the right to contest the results of tax audits, forcing the taxpayer to pay the amounts ordered by these audits, within in a deadline of one month, in order to be able to initiate formal questioning of those results.  Now, the Supreme Court of Costa Rica has taken away that power from the Taxation department, declaring it unconstitutional.

Guatemala: Tax Calendar May 2015

May 2015

Payment schedule of liabilities for April 2015 and Tax Memorandum on Fiscal Solvency.

Tax Memorandum by Tezó and Associates:

After several suits claiming the unconstitutionality of Article 57 "A" of the Tax Code which establishes fiscal solvency, this rule is in force, except the paragraph that reads "The Tax Administration will determine the requirements, characteristics and other necessary conditions for obtaining it." , which was declared unconstitutional.

Guatemala Passes "Anti-Evasion Act II"

January 2012

Congress has restored a higher tax rate on tobacco, one that had been eliminated last year, and has decided to establish special invoices for farmers.

Guatemala's Congress has approved the so-called Anti-Evasion Act II, with 120 votes out of a total of 158, which, among other things, restores the higher tobacco tax rate, abolished in 2011.

Guatemala: British American Tobacco Willing to Dialogue

October 2010

After a decision by the Constitutional Court, the tobacco company announced its willingness to dialogue.

The decision of the Constitutional Court in favor of an appeal by British American Tobacco, which alleged double taxation, will negatively impact tax revenues.

Sofia Oliva, manager of corporate affairs of the company, told Prensa Libre, "After being notified of the decision, we initiated contact with the government authorities to find long term solutions."

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