A bill by the Morales administration in Guatemala proposes creating an agency that would manage issues of commercial promotion, competitiveness, investment attraction and country brand.
Representatives from the Ministry of Economy presented in Congress a proposal for a Law to create the Institute for Commercial Promotion, ProGuatemala, which would absorb the functions and staff that at the moment execute the National Program of Competitiveness.
After making more than 40 amendments to the previous project, the legislative commission will be presenting a proposal and expects the process to move forward without further modifications.
The Economy Commission of the Congress of the Republic reported that they presented a second opinion on the Competition Law initiative, and took the opportunity to explain that among the parties that participated in the work room, they agreed that the topic will be addressed in a single reading and no last minute amendments will be presented.
Complaints have been made that there is not a clear and complete record of the number of companies benefiting from special tax regimes.
It is estimated that there are approximately 3,000 taxpayers who fall under the tax exemptions regime, either totally or partially. However, this data has not been confirmed by the Superintendency of Tax Administration, even though it had to submit its first report in 2014, according to the rule which came into effect in November 2013.
Being called into question is the establishment of a reduction of income tax payments when calculating as a deductible expense extra benefits given by companies to their employees .
The accusations were made by some MPs who met with the acting head of the Superintendency of Tax Administration (SAT), Omar Franco and Deputy Minister of Finance Durval Carias.
In Guatemala and proposals arising from the recently passed amendment to the Communications Act, which extended radio concessions for 20 years.
In light of the act coming into effect, deputies in the Transparency Commission are preparing a bill relating to the issue of transparency, Deputy Carlos Barreda, a member of the panel, said "We must establish that the usufruct be delivered through an auction or implement a public payment for its renewal.
An initiative presented by the Unidad Nacional de la Esperanza (UNE) has technical consensus from the Superintendency of Banks and Tax Administration, the Banguat and the Ministry of Finance.
Deputy Carlos Barreda, a member of UNE, said that if it is not approved, tax revenue losses could reach about $38 million.
"Late last week, a similar initiative emerged from the legislative agenda to return to the Committee on Economy, after the minister from the ruling party Emmanuel Seidner presented a motion in which he said that several aspects of the proposal still need to be evaluated", reported Prensalibre.com.
The New State Purchases Law would increase the limit in direct purchases from $3,700 to $9,300
Additionally, the Comptroller General of Accounts is proposing that the direct purchase process should be done with a bidding stage. Carlos Menco, head of the Comptroller's Office, told the Periódico of Guatemala that "the proposal is for a bid to be published on the website for such acquisitions, but the competition should not go through the same terms as a tender."
The Guatemalan Government will collect $494 million less in taxes in 2009 and the national budget could be reduced to $5.562 billion.
It was reported in the Prensa Libre website: "To meet the revenue decline for the budget, the government is already prepared with four scenarios: the first would be to reduce public spending, the second to search for internal or external credit, the third to increase revenues via taxes, and the fourth could be a combination of the previous three."
The extended exemptions from paying taxes in Guatemala haven't been effective for attracting foreign direct investment (FDI).
The 11 billion quetzales (about 1.458 billion dollars) in tax revenues that the government has decided to forego have not achieved the goal of attracting more capital.
A study released Tuesday says that reducing tax breaks and focusing on making taxes to existing business less onerous would be more productive for the nation.
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