Next week the vote on the tax reform will begin in the Chamber of Deputies, an initiative that, as proposed, “disincentives savings and investment,” said the president of the Chilean Chamber of Construction-Ñuble, Ricardo Salman Aburdene. .
The union leader maintained that “the tax reform discourages saving, both for companies and for middle-class families. A direct consequence of this is that there will be fewer buyers to make homes available for rental, and probably at higher prices, because rental income will now be taxed. With this we will be aggravating the shortage and the problem of the housing deficit”.
Salman also pointed out that “it affects the savings of companies by penalizing undistributed profits with a 2.5% tax, therefore, there is less capital support in the company to be able to make improvements and investments that result in greater productivity, necessary to generate increases in salaries”. In this sense, he stressed that “the incentive is no longer placed on investment, but on the money being withdrawn and spent by the owners.”
Companies
Likewise, the businessman stressed that this reform affects both large and small companies. “With a higher tax, investment is discouraged, and large companies, which are 2% of the total, but responsible for 53% of sectoral employment, some 390,000 workers in the country; Employment can be directly affected if these companies invest less. If investment in this segment fell by 10%, we would be talking about 39,000 fewer jobs.”
He added that “nearly 19,000 SMEs that employ 300,000 people in the country will also be affected, since their sales exceed 75,000 UF per year, which will prevent them from benefiting from the special tax regime,” narrowing their profits, and limiting the possibilities of being able to reinvest and generate employment.
He explained that the desinTax integration “will mean adding to the 27% tax paid by companies an additional 22% corresponding to the retirement of their owners. If the owners are in a higher complementary global rate than this, they can easily exceed the 50% tax rate.
He added that “for large investments that require several years to execute; By the time the income from sales arrives, it will not be possible to take all its costs to expense in that same year -only 50%- and with this, the profit will be artificially inflated, paying taxes for non-existent profits. With this, the profitability of the projects falls, and with it the supply of goods, investment and employment”.
Regarding the elimination of the DFL-2 incentive for home buyers, which today is limited to two homes, he indicated that their income will be taxed with the complementary global income tax. “It will no longer be an incentive for families to save.”
He stressed that “buyers of rental homes can reach 40% in a project, we are talking about 20,000 units per year that may eventually not be available as a new rental offer, aggravating the shortage and the housing deficit.”
