By Felipe Salinas, Tax Director at CCL Auditores Consultores.
Read the letter in Diario Financiero.
Dear Editor,
Diario Financiero reported that the Internal Revenue Service (SII) identified in 2023 around 10,000 high-value assets in the country subject to the new luxury tax that came into force that same year, which resulted in payments of approximately CLP 26 billion.
While it is good news that the SII is effectively carrying out its supervisory role and that different entities are properly reporting their figures—thus contributing to greater transparency in the system—I believe it is important to highlight certain points.
It may seem obvious, but in order to purchase a high-value vehicle, considered a “luxury asset,” one must first earn the income, which is already subject to personal income tax (up to 40%, excluding other effects). When purchasing the vehicle, one must also pay Value Added Tax (19%), Transfer Tax if it is a used vehicle (1.5%), Green Tax if it is new, Stamp Tax if it is financed (up to 0.8%), annual circulation permit (up to 4.5%), and now, the Luxury Tax (2%).
It is important to acknowledge the SII’s effective work, but I also believe it is necessary to ask: what is the reasonable limit of taxation on the same amount of money?