Nicaragua: Businesses Need More Fiscal Reform

Business leaders see the government’s tax reform bill as insufficient and analysts suggest including more sectors in order to stimulate economic activity.

Thursday, February 2, 2012

The Superior Council of Private Enterprise (COSEP) has stated that the tax reform bill that the government has sent to the National Assembly, was not consulted on with the private sector and they consider it "inadequate", reports El Nuevo Diario on its website.

The government of President Daniel Ortega has proposed to Parliament removing the Selective Consumption Tax (ISC) for milk based beverages and reducing income tax (IR) on stock transactions which exceed an annual amount of C $60 million ($2.6 million) for rice and raw milk.

"This is an issue where we need to look at how it can be corrected. There are no companies which publicly trade and sell milk above the C $60 million ($2.6 million) mark, there is no producer which publicly trades 3,600 gallons of milk per day”, argued Jose Adan Aguerri, President of COSEP, according to the article on the website.

Luis Arevalo, General Manager of the Agricultural Commodity Exchange of Nicaragua, agreed with Aguerri. Arevalo said the reduction in the tax burden should be applied to primary production sectors who also pay taxes but who do not trade above the established C $60 million mark, as rice trades at 140 million dollars annually.

More on this topic

Nicaragua: New Law on Free Zones

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The new legislation extends the tax benefits enjoyed at current export processing zones, to free trade zones in other sectors such as logistics, outsourcing and agricultural exports.

From a statement issued by the National Assembly:

The legislative approved on October 8 the draft Reform Law Decree Nº46-91 "Export Processing Zones".

Panama: New Law on Prevention of Money Laundering

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A bill which is to be submitted to the National Assembly in February establishes an obligation to report suspicious activities which are not specifically financial.

This initiative is part of the package agreed with the Financial Action Task Force (FATF) to strengthen legislation against money laundering and exit so called "greylists". It is expected that an updated legal structure will be in place by June 2015.

Draft Law on Exports Ready

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The Nicaraguan National Assembly could be receiving a draft Law on the Promotion of Exports next week.

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Unions Opposed to Credit Card Law Reform

October 2011

Salvadoran private sector unions have expressed their opposition to state intervention in the market.

The new law, which sets a ceiling on interest rates for credit cards, is deemed to be a hindrance for the country's economy.

According to the Salvadoran Foundation for Economic and Social Development, Fusades, the reforms will result in reduced access to financing, they are therefore calling on President Mauricio Funes to veto the reforms.

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