On Monday, November 1, 2021, the presidential candidate of the Apruebo Dignidad pact, Gabriel Boric, published his government program. The N°3 of the Second Chapter of said program is called “Changes with fiscal responsibility: tax reform and fiscal strengthening”, which contains a tax reform proposal that, according to the text, would raise, in regime, 8% of the GDP. The following are the main tax reforms proposed by this candidate:
1. New income tax regime.
– Disintegration of income tax for large companies and investment companies (first category tax would lose the character of credit imputable against final taxes).
– Modification of brackets and rate increases of the Global Complementary New income tax regime.
2. Reduction of exemptions.
– Elimination of the presumptive income regime.
– Elimination of the tax exemption on capital gains obtained in sales of shares and quotas with stock market presence.
– Elimination of the benefits applicable to DFL 2 real estate.
– Reduction of the tax exemption amount on capital gains obtained in the sale of real estate and elimination of the single 10% tax rate.
– Elimination of the tax exemption applicable to capital gains obtained in the sale of real estate acquired before 2004.
– Elimination of inheritance tax exemption with respect to life insurance.
– Elimination of the special VAT credit applicable to construction companies.
– Elimination of First Category Tax exemption applicable to Private Investment Funds.
3. Wealth taxes.
– Wealth tax on high net worth individuals.
– Tax on retained earnings in companies whose taxation with final taxes is pending.
– Increase of the Land Tax surcharge and new real estate valuation rule.
– Modification of inheritance and gift tax.
4. Green taxes.
– Increase of the specific tax on fuels and elimination of exemptions from such tax for industries and transportation.
5. Royalty to the great copper mining industry.
6. Measures against tax evasion and avoidance