Chile’s House to Discuss Tax on Super Rich

SANTIAGO – Representatives from the Chilean opposition are proposing a tax modification that would seek to implement a tax on super rich people in Chile. All people with assets worth US$22 million or more will pay a tax of 2,5 percent, which could be used to finance emergency plans proposed by the government. Members of governing party UDI have opposed the idea.

The pandemic has caused an economic crisis in Chile that will leave its marks for the years to come and in an attempt to ease the burden on the Chilean government and generate income, opposition members have proposed a tax on super rich people in Chile. According to the group of representatives, from a large variety of opposition parties, the transitional tax should apply to all people with assets worth more than US$22 million.

Around 1,900 Chileans, who altogether own around US$200 billion dollars, would get taxed 2,5 percent, something that according to the initiative would raise around US$6 billion dollars. Money that the government can use to finance its emergency plans with. The proposed bill would mean another constitutional reform, which means another heated debate lies ahead, a week after the pension bill was approved in the House through a historic vote.

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Karol Cariola, representative from the Communist Party (PC), said according to Cooperativa, that the bill would be “act of justice, especially when there is such a brutal absence of the government regarding the daily needs of the families that are having a hard time, the poorest families, the middle class families, those who had a change of situation in their respective economic conditions”.

Jorge Allesandri, representative for government party UDI, rejected the bill, stating that it “breaks the rules”. He also criticized the fact that the president of the Constitutional Commission of the House agreed on discussing the initiative. The president, Matias Walker from the Christian-Democrats, said that the debate would be discussed on Thursday. “I know it will generate controversy but that is what Congress is for, to discuss all the issues. We will have a serious debate, where the most important thing will be to invite professors of constitutional law and tax experts”.

Minister of Economy Lucas Palacios also commented on the initiative, and he said he would be open to discuss the bill. However, he indicated complications could arise. “Tax issues are complex because sometimes they affect investment, job creation, wealth creation, which is something we need in our country, so we have to be open to those discussions, but study very thoroughly what the impact is”.

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