The PDG (Partido de la Gente – People’s Party) of Chile has sent the Minister of Finance a document of proposals regarding the tax reform. Likewise, other political parties in the Chamber of Deputies are receptive to dialogue on tax evasion.
Key Aspects
Herein, the regulation of tax evasion must be optimized. In this regard, the PDG states that one of the reasons taxpayers do not pay taxes is due to the lack of trust in the State as a tax collector and service provider.
On the other hand, the Partido de la Gente has proposed a definition for the term “avoidance” that differentiates it from the concept of “evasion.” Likewise, to introduce the principle of the main purpose, by which the true business reason is demonstrated.
Other Relevant Issues
Additionally, the PDG proposes to establish a general anti-avoidance rule, mandatory disclosure of tax structures, revision of the Transfer Pricing rules, control of tax treaty abuse, penalties, and fines, as well as collaborations with foreign tax administrations.
Concerning evasion, the representatives of the Partido de la Gente suggest strengthening auditing procedures through investment in technology, continuous auditing procedures, fostering the use of e-invoicing, and automatic exchange of information.
Source: Diario Financiero
