The tax burden for some companies could decrease to 24% with the development rate. Analysts value the idea but see room for further adjustments.
Read the full article in El Mercurio.
The reduction of the corporate tax, which was not included in the original tax reform and was proposed by the opposition and business associations during the debate, was positively received by analysts, as it would be a measure with a reactivating effect.
“It is a recognition of the country’s current economic situation; therefore, the reduction in the First Category tax rate is quite significant. At the same time, there is also a reduction with the development rate; thus, under a standard model, the rate would decrease from 27% to 25%, and with the development rate it would be reduced by one additional point, reaching 24%,” explains Javier Jaque, Managing Partner of CCL Auditores Consultores, who also highlights that “this is a good effort to try to boost economic activity in the country. The market was expecting this; it is a positive signal.”
REVENUE: The Government’s fiscal pact aims to generate additional revenues equivalent to 2.7% of GDP.
Jaque also states that “the mention of the rule on the use of 50% of losses should be reconsidered, as it works against incentives for depreciation.”