By Agustín Brzovic, Legal Director of Tax Consulting at CCL Auditores Consultores.
Read the letter in La Tercera.
Dear Editor:
A few days ago, the creation of a temporary fund for the reconstruction of Valparaíso following the severe fires was enacted into law. This mechanism, which will be funded by both public and private contributions, includes a scheme to unlock resources by paying a corporate tax ranging from 12% to 30%, depending on the case.
The approval of a substitute tax for final taxes in its version 3.0, under the name ISIF, represents a milestone in the government’s tax policy. However, its implementation will not be without challenges and controversies regarding its design and effectiveness.
In this regard, the exclusion of first-category tax credits in the determination of ISIF for taxpayers under the semi-integrated regime limits its incentive and the effectiveness of the measure. Additionally, the absence of an option to terminate the Reinvested Profits Fund through a mechanism similar to ISIF, namely ISFUR, is noteworthy.
However, it is encouraging to see progress by granting exemptions to taxpayers in response to the emergency in Valparaíso, seeking incentives to facilitate tax payments. Nevertheless, its implementation by taxpayers requires careful review to maximize its effectiveness and benefits.