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Tax measures adopted by the Chilean Government due to the effects of Covid-19

Introduction 

 

Replicating measures adopted by other countries such as the United States, France and Italy, on March 19, 2020, the Government issued a package of economic and tax measures to partially finance the effects that Covid-19 will have on the national economy. 

 

Basically, it is a series of measures that are contained within 3 large groups: (1) Strengthening the Health System; (2) Protecting Chilean families’ income; and (3) Protect labor sources and companies that generate them. 

 

In economic terms, these measures amount USD 11,750 million approximately, which is equivalent to 4.7% of the GDP. 

 

In addition, President Piñera used of the power granted by the Political Constitution of the Republic to use an amount equivalent up to 2% of the expenses authorized by the Budget Law, to decree payments not authorized by law, in order to be able to finance urgent needs, which derive from public calamities, serious damage or danger to national security, the exhaustion of the resources necessary to maintain services that cannot be paralyzed without causing serious damage to the country, among others. Even though it is not the first time that this power has been used, it is the first time in the history of Chile that such a high amount of fiscal stimulus and support has been authorized. 

 

To read more, please click the PDF attached below. 

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