Key week for delegation of tax powers

Less than 10 days before the end of the first ordinary legislature, this week the Congress It will debate – and possibly approve – the prediction that grants the Executive powers to legislate on tax, fiscal, financial and economic reactivation matters.

This newspaper learned that this Tuesday the Constitution Commission would be ruling on the Executive’s proposal and They expect to vote on it no later than Friday, December 10.

Meanwhile, the Economy Commission will hold an extraordinary session this Friday to discuss the prediction that authorizes the Executive to legislate on tax matters.

In this regard, the vice president of the Economic Commission, Luis Kamiche, told this media that he hopes that legislative powers can be given to the Executive before the end of the year, since this is necessary to contribute to the economic reactivation.

Against time

In dialogue with the Republic, the head of the Ministry of Economy and Finance (MEF), Pedro Francke, indicated that it is important that this Government obtain the powers to legislate this month, since the intention is to issue the legislative decrees before the year-end, since in this way changes in tax matters may be applied in 2022.

“Taxes such as the Special Mining Tax or the issue of capital income have to go through Income Tax. Then, If it is not approved before the end of the year, it can no longer be applied by 2022, rather, any change would only be applied from 2023 ″, said the official.

Along the same lines, the minister Francke indicated that, if the tax reform is not applied in 2022, Peru would be failing to collect up to S / 12,000 million in that year.

In this regard, the economist and spokesperson for the Peruvian Tax Justice group, Cesar Flores, asked that this issue be discussed as soon as possible in plenary, since the country cannot continue to postpone the tax reform.

In this sense, the specialist considered that, if necessary, the Congress of the Republic should expand the legislature so that the powers can be given to the Executive in this 2021. “It is important that this reform be discussed and approved before the end of year and what give him the margin of time so that the Executive can present the proposals “, he pointed out.

Finally, Flores recalled that Peru has a tax pressure of around 14%, being one of the lowest in Latin America (23% on average), so a tax reform would be a great advance so that it can be raised, in addition that would help to obtain more income to meet the demands of the population.

S / 60,000 million would be collected in five years

According to the MEF, the tax reform aims to generate around S / 60,000 million in revenue in five years.

With this amount, it would be possible to finance 6,200 kilometers of highways, 2,400 first-level health posts, 60 second- and third-level hospitals, close the long-term education infrastructure gap in the country and provide drinking water for 4.5 million in rural areas.

Reactions

Pedro Francke, Minister of Economy

“As I have already said, our estimate is that the annual collection could rise between S / 8,000 and S / 12,000 million. If we did not get any measures, that would be more or less what we would lose ”.

César Flores, Tax Justice Group

“In the regions there is a much more favorable view of the tax reform possibly than in Lima (…) because there is awareness that these resources will be directed towards these populations.”