An agreement has been made to postpone until May 25 the effectiveness of various lists of tax breaks for the purchase of raw materials in order to work on a single document and add new products.
At a meeting between representatives of the government and the private sector it was agreed to extend the validity of the lists for tax exemptions in order to negotiate within that period the inclusion of other products and the creation of a single document. It was also agreed to remove fines for importers starting from 1 April.
A controversial clause which invalidated the right to deduct anticipated monthly minimum payments in settlement of income tax has been removed from the declaration form.
After receiving criticism from the private sector and experts claiming that the amendment violated the tax law, the Directorate General of Revenue (DGI) has removed from the tax form the check box that did not recognize the right of deduction of anticipated minimum monthly payments in settlement of income tax (IR).
The Government has abolished the regulations of the Tax Coalition Law which created new taxes and fiscal measures.
Jose Adam Aguerri, head of the Superior Council of Private Enterprise announced that the regulations on the Tax Coalition Law will be canceled by the Government of the country.
"President Daniel Ortega signed an order repealing the controversial decree 06-2014 containing the regulations.
Through this move, transfers by private and state employers to the Nicaraguan Institute of Social Security will increase by $26 million.
This was announced José Adán Aguerri, president of the Superior Council of Private Enterprise (Cosep). Of that $27 million, $6 million will be provided by state enterprises and the rest by private companies.
"This increase in the employer contribution is something that has been established in the negotiations we have had with the government," said the chief of Cosep.
Businessmen are opposing, because of its illegality, the position of the Department of Revenue, which is ordering free zone companies not to buy raw materials or services from providers who owe taxes.
In addition, the Department of Revenue (DGI by its initials in Spanish), asked companies to ask suppliers to pay off their debts, a proposal that has been rejected by the private sector.
The projected tax reform is a battlefield for the competing interests of the various productive sectors.
Both the Superior Council of Private Enterprise (COSEP) and the Union of Agricultural Producers of Nicaragua (UPANIC), are in favor of excluding the agricultural sector from the discussion of tax reform, meanwhile the National Workers Front (FNT) and the Nicaraguan Council of Small and Medium Enterprises (Conimipyme), reject such a position as discriminatory.