Recently, the deputies approved Decree 31-2024, The law for the Integration of the primary Productive and Agricultural Sector. experts warn of loopholes and suspicions that could encourage or open up possible money laundering, reward with tax amnesty, reduce taxes for certain sectors and, therefore, influence the fiscal deficit.
- they ensure that the doubt is focused in several articles, but mainly in Article 21: late presentation or correction of declarations.
In perspective. On November 19, the deputies approved the law that seeks to create and regulate special tax regimes specifically for agricultural producers, crafts, livestock, hydrobiological products and beekeeping.In marathon fashion, it was approved as a matter of national urgency.
- The law specifies that the Special System for the Production and Marketing of Agricultural and Handicraft Sector Products produced in Guatemala—Primary System—applies to those whose gross sales do not exceed the minimum wage of GTQ 3,500 for the non-agricultural sector. That is, within the fiscal period from January 1 to December 31.
- in addition, it indicates that they are obliged to pay a tax of 1.5% of the amount of gross sales, with some exceptions – exporters of products defined in this law as agriculture and crafts, who will pay 2% of the amount of their -gross sales. .-.
- Even though, in the Special System for the Production and Marketing of Products from the Livestock, Hydrobiology, and Beekeeping Sector—livestock System—, each of those must pay a tax equal to 1.5% on gross sales.Exceptions include intermediaries of bovine products in the livestock sector, who will pay 10% on profits.
you Erick Echeverría, Mayor of the Collection, said that the regulations create three new tax figures for participants in the chain of production, sales and profits for this sector. However, it does not clarify the issue of needs and the gap in the writng of this article. The statements were made during a radio interview last week.
- Experts consider that the analysis made by the General Secretary of the Presidency of the decree must be thorough,because of the gaps.Then, the Supervision of Tax Administration (SAT), having already published the standard in the Official Gazette, must make the decision regarding its implementation, but according to the legal standard.
- they suggest that the SAT should make a statement to explain the scope, but they should prepare for the actions that may occur. “Taxpayers might say, well, that’s an issue that should apply to everyone. We are talking about complete exemption of interest and fines and nothing more then 5% is charged,” they say.
Yes, but. Suspicion of the recently approved laws is not new and is not so dubious in the current legislature. The problem is that they are done in haste and without analysis; One of the most loophole decrees has already been mentioned, because it contradicts the purpose of attracting and collecting taxpayers, untill amnesty is granted, not forgetting that it opens the door to possible money laundering.
- Óscar Chile monroy,an expert in tax affairs,declares that section 21 – late presentation or correction of a declaration – is the most controversial due to the inaccuracy of the wording.
- “In my opinion,in the first part it says that taxpayers must submit their return if it is omitted,or correct what they submitted by mistake. Then he says they have omitted to declare income. Here comes the big pocket: people who have omitted to declare bank or non-bank income […] received before the law came into force, there is no documentation to justify the initiative.He is leaving everything open. Here they can take advantage of the legalization of unfounded money,” he says.
- In addition, it shows that it is indeed interpreted that people can declare the inventories they want to record to start their accounting, provided that they pay 5%. “In other words, someone can say to me: I have so many millions of inventory here, I’m going to register it. By paying 5% you already legalize those assets.”
Interview Between Time.news Editor and Economic Expert
Editor: Welcome too Time.news,where we dissect the important issues shaping our society. Today, we’re diving into the recent approval of Decree 31-2024 by deputies, which is designed to integrate the primary productive and agricultural sector. Joining us is Dr. Elena Martínez, an economist and expert in agricultural policy. Thank you for being here, Dr. Martínez.
Dr. Martínez: thank you for having me! I’m excited to discuss this important topic.
Editor: Let’s start with the basics. Can you explain what Decree 31-2024 entails and its intended purpose?
Dr. Martínez: Certainly! Decree 31-2024 aims to create a framework for a special tax regime that targets various sectors, especially agricultural producers, crafts, livestock, hydrobiological products, and beekeeping. The objective is to promote advancement within these sectors by providing favorable tax conditions and simplifying regulations to aid small producers.
Editor: It sounds beneficial, but ther have been warnings from experts about loopholes that could lead to misuse, particularly regarding money laundering. Could you elaborate on that?
Dr. Martínez: Yes, that’s a important concern. The primary worry centers around certain ambiguous provisions, particularly Article 21, which deals with the late presentation or correction of tax declarations. Critics argue that this might inadvertently allow for tax evasion mechanisms where individuals could manipulate declarations without facing severe repercussions.
Editor: How might these loopholes affect the fiscal deficit, especially if tax amnesty is part of the equation?
Dr. Martínez: If tax amnesty is offered too liberally, it could reduce the government’s revenue by allowing certain sectors to circumvent their tax obligations. This is especially troubling in a vulnerable economy where fiscal deficits are already a concern. We need a balanced approach that encourages compliance without rewarding avoidance.
Editor: On November 19, the law was passed in a session labeled as a matter of national urgency. Do you think this hurry could have affected the thoroughness of the legislation?
Dr.Martínez: Absolutely. Rushing through legislation frequently enough means that adequate scrutiny is sacrificed.When critically important laws are passed quickly, there’s a greater risk of overlooking potential pitfalls. It’s crucial that legislation—especially those with significant fiscal implications—is carefully evaluated to avoid unintended consequences.
Editor: Moving forward, what steps do you think need to be taken to ensure that this decree is implemented effectively and responsibly?
Dr. Martínez: Openness and accountability must be at the forefront. The government should establish a clear mechanism for monitoring how these tax regimes are applied. Additionally, involving civil society and independent experts in the evaluation process can definately help identify and rectify any loopholes early on. Continuous oversight is essential to ensure that the benefits intended for the agricultural sector reach those who truly need them without opening doors to abuse.
Editor: Thank you, Dr.Martínez, for your insights into this complex legislation. It’s vital that we continue these discussions to support both the agricultural sector and the integrity of our financial systems.
Dr. Martínez: Thank you for having me. It’s a pleasure to discuss these crucial issues, and I hope we can continue to raise awareness on them.
Editor: Absolutely! And for our viewers, stay tuned for more updates on this topic and other pressing issues affecting our economy.
