The Legislative Assembly passed a quick debate of the Strengthening of Public Finances Bill. Legislators agreed to create a Special Committee, which will rule on the bill in the next three weeks. After that, the Committee will vote on the text without discussion and legislators will have six sessions to analyse and discuss the bill on the floor.
The measure sets the Value Added Tax (VAT) at 13%, substituting the Sales Tax but increasing the number of products and services covered. The objective is that whoever collects the sum corresponding to this tax, deducts the paid amount from its suppliers. As a result, national goods will more competitive and the transfer of these amounts to costs of production is avoided.
In this context, credit and debit cards will be important when acting as withholding agents -both locally and internationally- and turn over to the Treasury the percentages corresponding to the aforementioned tax. Products and services, tangible and intangible goods, will have to pay the corresponding contribution -no matter in which country the supplier is located- and the percentage will be equivalent to the amount consumers pay for their purchases.