Marcelo Montecinos/The Santiago Times Staff
SANTIAGO – The Communist Party of Chile began a constitutional reform project on June 2 which would institute a one-time 2.5% tax on the assets and income of the super-rich. The additional funds would go towards alleviating the government costs associated with the Covid-19 pandemic.
The president of the Production and Commerce Federation, Juan Sutil, was quick in saying that this would be a mistake.
“It’s not that I am against raising taxes nor changing things, but…all of the one-time taxes that have been applied in the last few years in Chile, have become permanent, all of them,” he told Radio Cooperativa.
And he is correct. A one-time tax was imposed in 1986, for example, that went towards re-building Chile’s infrastructure after the devastating 1985 earthquake; the tax is still in place today, 14 years later.
The new taxes would bring in up to $2.2 million dollars into government coffers which would go towards pacifying Chileans that took to the streets in protests demanding a higher minimum wage, higher pensions and a better health and educational system.
The tax would increase for those that make more than $18,900 a month and have assets, or housing, worth more than $500,000. The reform would also increase taxes on large companies to 27% while lowering taxes for pensioners.
The reform was passed by the House of Representatives on May 26 and is currently awaiting to be signed into law by President Sebastian Piñera.
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