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2 New Ways El Salvador Is Taxing You

Article Summary:

El Salvador plans to impose a tax of 0.25% on financial transactions, which is divided into two parts: a tax on checks and wire transfers and a tax to control liquidity, applicable to individual or accumulated transactions with a value exceeding $3000.

Photo Credit: Prensa Grafica

Original Article Text From La Prensa Grafica via Google Translate:

Proposed Tax on Checks and Transactions

The government has developed a project to create a tax on financial transactions, which is divided into two parts: a tax on checks and wire transfers, and a tax to control liquidity, applicable to transactions over $ 3,000 in value individual or accumulated in a month.

The draft Law of Financial Transactions Tax was worked by the Ministry of Finance and is already Presidency. The tax raised is 0.25% of the amount of the transaction, ie, $ 0.25 per $ 100. “The tax shall be imposed on the amount paid for any type of check and wire transfers in the country,” the project.

For this tax is in effect, the Legislature must approve and sanction the President. A source close to the process of developing this project said the Treasury expected to be in force and begin to apply from January 2013.

The Retaining this tax, then report it and move it to the Treasury, will be the same entities in the financial system: banks, cooperatives and credit unions, and state banks.

Eduardo Amaya, director of UHY Auditax, firm specializing in issues tributaries, said the bill provides that the tax applies to debits in deposit accounts and money orders or transfers by check payments, payments by electronic transfers, transfers to third parties, loan disbursements and transfers between banks.

“Tax apply when payment is made, transfer or disbursement, “he said. The bill provides exceptions.

For example, no such tax is payable by cash from accounts payable credit cards, payment by credit or for payment of wages. Neither are taxed transfers between accounts of the same person, or service payments basic water and electricity. would be exempt from paying the state, the municipalities, the autonomous, diplomats, international organizations and pension funds, among others.

Control liquidity
The second part of the bill establishes a tax control liquidity that apply to all deposit and cash withdrawal over $ 3,000. This amount can be for individual transaction, or accumulated for a month. “states that tax withholding for liquidity control will be creditable against other taxes,” said Amaya.

This means that companies that already pay withholding taxes can use to pay other tax obligations. Marcela Jimenez, executive director of the Salvadoran Banking Association (ABANSA), said the project being analyzed to establish a position as an association, and even suggestions for the Executive (see sidebar).

Link to Original Article:

From La Prensa Grafica

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