“Chile and the tax challenges of the future”, with the participation of Ricardo Lagos Weber and Juan Antonio Coloma

Webinar online / 2-09-2020
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On Wednesday, September 2 the sixth Frontal Trust’s webinar took place, and it was named “Chile and the tax challenges of the future”. Senators Juan Antonio Coloma and Ricardo Lagos Weber participated in this event. Both senators are members of the Comisión de Hacienda del Senado. In this opportunity, they analyzed the economic, fiscal and social situation in Chile, placing special emphasis on tax modernization.

In a relaxed conversation, moderated by the director of Diario Financiero, Marily Lüders, both speakers pointed out openly that they are in favor of reviewing tax exemptions.

Senator Lagos Weber said “I propose to review them, not to punish anyone. This means having an equitable tax burden because there are sectors that have a way of paying taxes that is not justified.”

Then Senator Lagos Weber added: “The presumed income will be analyzed, as well as incorporating the payment of VAT to other industries that are exempt.”

For his part, Senator  Coloma, declared that he was open to reviewing tax exemptions, arguing that “little has been studied in our country. Not necessarily to finish them, if not to value them. Going forward, exemptions should be limited in time or require that certain requirements be met in order to renew them.”

In the opinion of Senator Lagos Weber, the Dipres of Ministerio de Hacienda calculates that exemptions would reach  US$ 9 billion and many of them would have more than three decades.

During the discussion, dozens of questions were made, evidencing the great interest that arises from tax matters.  Carlos Cáceres asked Senator Lagos Weber if he agreed to maintain the exclusive power of the President of the Republic in budgetary matters. He answered that he is in favor of maintaining the exclusive power of the President in budgetary matters, “basically because of the political system we have in Chile.”

Senator Lagos Weber added that its not his intention to legislate on tax issues in this government, because he does not want to scare anyone. “Nobody likes to pay taxes. I am not fascinated by paying taxes, but I pay them. It must be done. Nor do I say that I will not discuss it. In the last three governments this discussion has existed. It is important to talk about this issue ”.

Before ending the meeting and thanking speakers and the moderator, Andrés Echeverría, the main partner of Frontal Trust, addresses tax exemptions issues. “Many times they are misunderstood as privileges for the capitalist class and the business community, which is completely false …

“We at  Frontal Trust relate with investors and real estate business entrepreneurs, many of which have been with us this morning. We know that when there are many bidders, especially in businesses that have low entry barriers, any tax issue is priced. In terms of housing, eliminating tax exemptions only constitutes a continuous rise in prices, which mainly affects the middle and lower middle sectors, when it should be the opposite. Hopefully we can continue talking about these issues, ” he concluded.