Chile’s Lower House approves Wealth Tax

On the 21st of April, Chile Chambers of Deputies approved a Bill proposing a constitutional reform project which will implement tax measures to finance an emergency universal basic income.

The aim of this measure is to support middle and low income families that have been impacted the most by the Covid-19 pandemic. 

The Bill introduces a one-off wealth tax of 2.5% on Chilean residents or domiciled as of December 31, 2020 with a net worth of USD22 million and above; comprehending assets located  both in Chile and abroad. The tax will come into force on the date of the Bill’s publication in the Official Gazette, providing taxpayers with a 60 days period to comply before the application of penalties.

The proposal also includes a tax on companies with an average gross income greater than 1 million development units (Unidades de Fomento) in the three years before the publication of the legislation. Such companies would be liable to pay an increased first category tax rate of 30 percent during 2021 and 2022.

The Bill will now have to be discussed and voted before different commissions before being voted by the Senate.