The coffee union has stated that the advance payment of withholding tax reduces the trade margin of exporters by up to 40%.
The obligation to pay an advance withholding tax (IR) to the DGI is threatening the competitiveness of coffee growers, especially companies whose profit is on commission on sales that are placed on the international market. The complaint was made by Michael Healy, president of the Union of Agricultural Producers of Nicaragua to Trincheraonline.com.
Ranchers are complaining that the increase of $0.20 per kilogram of cattle exported as leather is eroding their competitiveness.
The DGI published in La Gaceta on 4 February that "... In every act of exporting live cattle made by natural persons, it will be mandatory to submit to the Center for Exports (CETREX ) and the Directorate General of Customs Services the taxable receipt in original format which supports retention payments for its verification. "
83% of companies operating in a legal framework and who were surveyed by the Superior Council of Private Enterprise, obtained credit when they requested it to the financial system.
Up until September 2015 imports of ground vehicles, tires and lubricants amounted to $450 million.
The Nicaraguan Association of Motor Vehicle Distributors (Andiva) confirmed that record high sales have been reached, with 19,000 units sold in 2015, 25% more than in the previous year.
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).
Real estate developers can now submit one letter for the tax exemption on the transfer of property.
With the pressure exerted by the Superior Council of Private Enterprise (Cosep) and the Chamber of Builders of Nicaragua (Cadur), an agreement was reached with the Directorate General of Revenue (DGI) to normalize the process of obtaining the Certificate of Exemption for payment of income tax (IR).
Entrepreneurs are unaware of new judicial courts especially dedicated to solving conflicts or disputes in this matter.
The entity was created a year ago and is responsible for resolving complaints and appeals related to tax and customs matters generated against institutions such as the Directorate General of Customs (DGA) and the Department of Revenue (DGI) .
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.
It is no longer necessary to physically present accounting books to the Directorate General of Income, saving Nicaraguan employers time and costs.
Companies no longer have to submit their books physically to the Department of Revenue (DGI) in order to be certified by the Revenue Office or the Directorate of Large Taxpayers, as per General Administrative Provision 02-2012 which became effective on 27th March.
The Nicaraguan Chamber of Industries is demanding greater flexibility from the Revenue Department in providing tax refunds to exporters.
Without specifying the amounts due for refund, the president of the Nicaraguan Chamber of Industries, Mario Amador said, "We have made arrangements with the DGI, as many employers have been claiming that they were not getting their money returned at the speed they wanted ". The delay in the payment of refunds has generated liquidity problems for exporters.
Most companies are unprepared to apply the changes required by the new Tax Law.
This was confirmed by spokespersons from the private sector, who added they could spend months learning the new regulations, incurring in additional costs.
"Businessmen complain that not even the Tax Authority (DGI), is ready to comply with the changes", reported Laprensa.com.ni.
Rules forces them to personally carried out the processes to get exemptions for each producer and for each transaction
Producers and distributors of agricultural products in the country rejected the General Administrative Regulation #15-2008 of the Income Department (DGI), which establishes the procedure for VAT exemption for the agriculture sector, the arts and crafts industry and the sports fishing industry, which could generate some $25 million dollars in new taxes for the Government.
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