MEF announces measures for formalization

In the last session of the Special Commission for Monitoring the Incorporation of Peru in the OECD (CESIP), which took place last October 3, the Minister of Economy and Finance, stated that different measures would be being worked on to combat the problem of informality, an aspect in our country that has been becoming increasingly latent and worrying since the crisis of 2020.

Thus we return to the possible alternatives, and not due to our own internal initiatives, but rather due to the pressure to join the OECD.

The main measure would consist of the simplification of tax regimes (“eternal litany”), which coexist in Peru. It should be noted that this measure is one that is coming “reviewing” since previous governments and which, unfortunately, has never become a serious proposal that has generated a definitive discussion for a possible implementation. Just remember the legislative proposal of the “RIPE”, that never saw the light; Incidentally, a Regime with a series of anti-technical aspects.

It should be remembered that the aforementioned simplification measure has not only been recommended by the OECD, but also by the World Bank through a report published last April, which contained other proposals both in tax matters and in other areas, and that have not come to fruition due to lack of political will.

Furthermore, this would be the second attempt by this government to develop a rational simplification proposal. The first came from Bill 3941/2022-PE, presented in January by the Executive Branch with the purpose of granting them the power to legislate on economic (and therefore tax) reactivation, expressly stating in the aforementioned document, the intention to simplify tax regimes. Curiously, despite having been granted the powers, Congress did not allow legislation to be legislated in this aspect of simplifying the regimes.

It should be noted that, from January to the current date, Congress has not made any proposal on the simplification of the tax regime or on the other tax points that were restricted to the Executive. However, since then it has become clear that the coexistence of the New RUS, the Special Income Regime (RER) and the Mype Tax Regime (RMT) has not achieved a significant increase in formalization among taxpayers, and instead, the The diversity of existing regimes has caused companies to atomize or dilute their income to belong and remain in regimes with lower tax and accounting obligations, being totally counterproductive to the sense for which these systems were established.

At that time, the Executive justified its proposal by citing statistics from the Ministry of Production, which indicate that the 99.2% of taxpayers who receive business income correspond to micro and small businesses (94.5% and 4.7%, respectively). Furthermore, the income range of medium-sized companies is very narrow, as a result of the fact that our business structure includes many more large companies than medium-sized companies.

Currently, the Minister of Economy has stated that the recent proposal aims to encourage MYPES to declare their payrolls and accounting books, through a series of benefits such as the application of accelerated depreciation to 100% and the automatic generation of your financial statements.

Additionally, credit would be facilitated for these companies and the Mypes Business Impulse program would become one of credit incentives to facilitate access to capital.

Another and final measure would consist of reducing the high non-salary labor costs paid by companies, in order to improve their efficiency.

Although the interest in once again putting the issue of simplification of tax regimes under the magnifying glass is welcomed, an interest that has not been seen even in the slightest extent by Congress, the objectives must be clear and a serious proposal must be reached that manage to focus the discussion, for which a relatively calm political and social context is needed.

But is it enough, to combat informality, to generate, as the main “workhorse” a new structure of tax regimes?

We think not. Thus a new structure of Regimes is created, the truth be told: the average Peruvian does not want to pay taxes and/or submit to fines that could bankrupt them. Prefers to develop in “dark zone” due to the very low tax culture, encouraged (but not justified), by the inadvertence of public works and services that tax collection should reflect.

So it is worth noting that no matter how many legislative changes we want to make, if we do not change the “chip” of compliance, we will not ultimately achieve the objectives. Once again, forms of avoidance and/or simulation will be sought, and we will finally be spinning in an endless vicious circle.

Very simple systems without major accounting obligations, respecting rates proportional to the profits obtained, with amnesties on fines for an initial period; greater tax education from schools; elimination of bureaucratic tax, labor and municipal barriers; with prizes for compliant taxpayers; requirement to be formal to access various procedures; among other measures, they would be those necessary to be evaluated as a totalizing package and not as simple “patches” to a coercive and discouraging reality of the formal, generated only for the OECD access photo.