News: Chile introduces tax amnesty for small and medium businesses

The Chilean authorities at the end of 2018 reported that more than 100,000 taxpayers in the country who own a business, engage in commercial activities or extract business income, owed the country's treasury more than 160 billion pesos in the last three financial years. After changing tax plans and the practice of collecting them through penalties and fines, the Ministry of Finance collected more than 42 billion (about 62.3 million US dollars) in local currency equivalent.

The local Ministry of Finance confirmed that after three years of more than a failed tax policy, amnesty would be applied to Chilean enterprises. Now all companies (including foreign ones) will be exempt from paying fines and penalties for the last three years, and enterprises and their owners will pay taxes to the state budget at the lowest rate of 24% of income. Also, companies are not required to pay taxes on dividends and personal icome taxes until the end of 2019.

The Ministry of Finance explained this move by the desire to release the guilty defaulters from additional penalties and applying mitigating measures to them. According to the Ministry of Finance of Chile, 91 percent of taxpayers in the country who have already used the tax amnesty are small or medium-sized businesses. Without the use of this right, it would complicate the task for the country's regulators to get full access to company reports and documentation. Due to the introduction of "holidays", small and medium-sized businesses will be able to generate all the necessary data for regulators and restructure payments on their financial obligations.

Law and Trust International provides an opportunity to register a company in Chile. To get more information about the cost of registration and its features, please contact our lawyers.