Guatemala: Proposal to Eliminate Oil Tax Exemption

A bill is being presented to amend the law on oil and use the resulting revenues to strengthen the country's security forces.

Friday, December 13, 2013

The initiative to amend the Law on Hydrocarbons and eliminating tax breaks for oil extraction was presented by Congressman Amilcar Pop.

Pop explained that the country loses about $15 million annually through exemptions and privileges related to oil."The tax system must be fair and equitable, the Hydrocarbons Law does not comply with the principles of justice in tax regulations," he added.

The intention is that these resources be used to strengthen the country's security forces. "Although the law states that the royalties on oil matters should not be less than 5% of production, the Ministry of Energy and Mines has no mechanism to control production", reported Prensalibre.com.

"Guatemala receives approximately $9.1 million in royalties from oil extraction."



More on this topic

Nicaragua: Incentives for Oil Investments

December 2019

By approving the changes to the Special Law for Exploration and Exploitation of Hydrocarbons, the country's oil sector contractors are exonerated from all taxes.

The amendments stipulate that transfers of agreed contracts shall not pay taxes during the exploration period, and the direct or indirect assignment or transfer of all or part of the rights derived under any modality for the activity of exploration and exploitation of hydrocarbons shall be exempt from any capital gains tax.

Guatemala: Plan for National Hydrocarbons Agency

October 2013

The Guatemalan State is proposing to boost oil extraction by creating an agency independent of the Ministry of Energy and Mines.

Keeping in mind the model followed by Colombia, "the Ministry of Energy and Mines (MEM) wants to create a National Hydrocarbons Agency, to increase the exploitation of those resources."

Hydrocarbon Extraction Law Moves Forward

August 2013

Bill 618 establishes a system of royalties and taxes on companies engaged in oil exploration and extraction in Panama.

The project, which amends Act 8 of 1987, has been approved on its first reading by the Commerce Commission of the Legislative Assembly of Panama.

The rule "includes a legal and tax regime applicable to the exploration and production of hydrocarbons, making changes to the description of permits and contracts for exploration and exploitation, as well as adjustments to the percentage received by the state", reported Panamaamerica.com.pa.

Panama Update Oil Exploitation Regulations

July 2013

The draft amendment to the current legislation seeks to establish a legal and tax regime which is more competitive and brings higher profits for the state.

From a press release issued by the National Assembly of Panama:

A bill amending and adding articles to Act 8 of 1987 regulating the activities related to hydrocarbons, was presented by Minister of the Presidency Roberto Henriquez before the full Legislature.

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