The National Reconstruction project concluded its legislative process this week, incorporating corporate tax cuts, reintegration and a tax invariability clause.
The initiative promoted by the government of José Antonio Kast ended its passage through Congress, putting an end to the tax reform of Michelle Bachelet’s second term. It includes a gradual reduction of the corporate tax rate to 23 percent, full reintegration of the system and an invariability mechanism for 10 to 20 years on new investments.
Twenty-one opposition senators filed a challenge before the Constitutional Tribunal against the invariability clause, arguing it limits the tax powers of future governments. Santiago mayor Mario Desbordes welcomed the compensation formula for municipalities over the exemption of property taxes for seniors over 65.
Finance Minister Jorge Quiroz led the legislative process. Government sources indicated that between 25 and 30 circulars and resolutions will be prepared for implementation, focusing on donations and capital repatriation.
