Guatemala's government presents a fiscal reform initiative

Guatemala's finance ministry began this week to send out information aboiut its proposed fiscal reform agenda.

Thursday, June 12, 2008

Measures proposed include a total rewrite of the Income Tax Law and changes to the law governing the value-added tax (IVA). The goal is to raise the load on taxpayers from 12 percent of Gross Domestic Product (GDP) to 13.2 percent.
The reform would affect company revenues, capital returns and dividends. It also contemplates phasing out the IVA tax deduction to employees who earn more than 3,000 quetzales (about 400 dollars) per month, over the next four years.

More on this topic

Guatemala: What Will Be Taxed and By How Much

August 2016

The proposal raises income tax from 25% to 29% for profits of over $38 billion a year, royalties for extracting gold and silver from 1% to 10%, taxes on fuels and a tax of $0.65 tax per bag of cement.

See document by the Ministry of Finance of Guatemala with details on each tax increase.

Guatemala Puts Finishing Touches on Tax Reform

January 2012

Among other measures, the bill proposed by the government examines establishing regimes for income tax and eliminating accreditation for VAT returns, a method that has encouraged evasion.

The new Guatemalan government has refined its proposed fiscal law reform, which includes proposals such as removing the accreditation of the VAT tax and setting different levels for the deduction of income tax.

Guatemala: Group Formed to Push Tax Reform

July 2011

Economists and former officials from the government make up the G-40 team, which is promoting fiscal reform.

The team of former Ministers of Finance, economists, former government officials and researchers from different ideological persuasions, aims to resurrect the financial proposal by the Tax Dialogue Promotion Group ("Grupo Promotor del Diálogo Fiscal") which was presented in 2008.

Guatemala: New taxes create controversy

September 2008

The proposal to create the Solidarity Tax, another for vehicle registration and one that will increase the VAT paid on vehicles has encountered resistance in the private sector.

Minister of Finance, Juan Alberto Fuentes Knight, defended the fiscal modernization proposal and explained that if new taxes are not created and if the existing ones are not modified, they run the risk of leaving a "fiscal hole" for next year.

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