Reform Of The Income Tax Act.

Original Language Title: REFÓRMASE LA LEY DEL IMPUESTO SOBRE LA RENTA.

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Read the untranslated law here: http://www.asamblea.gob.sv/eparlamento/indice-legislativo/buscador-de-documentos-legislativos/reformase-la-ley-del-impuesto-sobre-la-renta/archivo_documento_legislativo



1 Decree N ° 762 the Assembly Legislative of the Republic of EL SALVADOR, whereas: I.-that by Decree legislative N ° 134, of date 18 of December of 1991, published in the daily official N ° 242, taking N ° 313, of the 21 of the same month and year, is issued the law of tax on the income.
II.-that through Decree legislative N ° 957, of date 14 of December of 2011, published in the daily official N ° 235, took N ° 393, of the 15 of the same month and year, is reformed the law of tax on the income, introducing as part of them reforms the figure of the payment minimum to the tax on the income.
III. that declared unconstitutional the minimum payment applied to the 1% obtained income, income tax unconstitutional judgment 18-2012, issued at date of November 15, 2013, by the Chamber of the Supreme Justice Court constitutional, since determining as taxable income this income gross or obtained without the possibility of deducting costs and expenses required for its production and the conservation of its source, such provisions violate the tax equity in its manifestation of the principle of economic capacity.
IV.-that the purpose of the minimum taxes is that citizens who make use of services and public works, help defray the spending, measure that permits to comply with the principle of generality of contribute to the financial sustainability of the State, at the same time is a mechanism of fraud against non-existent or improper deductions.
V-which in several Latin American countries have been established under various designations minimum taxes, taking as a taxable net assets or revenues, or a combination of both.
VI. the incorporation of a minimum payment on the basis of an asset that is complementary to the income tax, creditable against this ensuring the principle of tax equity.
VII.-that there are exemptions to sector of printed communication that places them in a situation of privilege with respect to the other sectors of communication, so it should be repealed, to comply with the tax principles of equality, equity, and generality.
VIII.-that on the basis of the foregoing, is necessary to introduce a minimum payment to income on the basis of the net assets, which replace the revenues gross or taxed, as well as eliminating exemptions that do not conform to the designated tax 2 principles-based.
Therefore, use of his constitutional powers and initiative of Deputy Othon Sigfrido Reyes Morales and the Deputy Lorraine Guadalupe Pena Mendoza.
DECREES the following: reforms to the law of tax on the income article 1.-incorporated in the tax law on income title VII, chapter V, which heading will be "Payment minimum of the tax income", which will include articles 76 to 81, on the agenda and in the following manner: "chapter V payment minimum of the income tax taxable persons and taxable made article 76.-the annual income tax will have a payment" minimum, whose made generator is constituted by the possession of active NET in the year or period of imposition.
This material obligation taxpayers are the regulated in article 5 of this law. * Tax Base, tax aliquot declared unconstitutional.
Article 77.-the minimum payment of the income tax will be assessed on the amount of the net assets, with the rate of one percent (1%).
The amount of the net assets shall be determined by subtracting the value of the total assets, the sum of the values of the depreciation and accumulated amortization, the active fixed not operational, assets held abroad, actions in other Salvadoran society and the balance of financial obligations related to fixed assets that are in operation. Also, they deducted from total assets, the assets earmarked for agriculture and livestock, except for agribusiness.
Accounting standards approved by the Supervisory Board of the profession of the accounting public and audit will be used to determine the value of the property and rights that are part of the total assets, as well as the financial obligations. Subjects not bound to take formal accounting, will use the nominal value according to documents and records, in addition to apply provisions relating to depreciation and amortization 3 this Act.
Banks, savings and credit cooperatives societies, as well as supervised by the Superintendence of the financial system, credit unions, societies may deduct from the total assets, the value of received in dation in payment or seized property that form part of his active extraordinary.
If the subject is obliged to take formal accounting may subtract from the total assets, the value of the technical reserves that have been created according to standards of authority regulatory and provisions accounting according to the technical standards accounting authorized by the Supervisory Board of the profession of the accounting public and audit.
The tax base of the asset shall not exceed the amount of taxable gross income from exercise or period of taxation. (* Declared unconstitutional subject exempt payment minimum definitive article 78.-not subject to the minimum payment of the income tax: a) the natural persons who obtain income only from wages and salaries;
(b) users of industrial zones and marketing; of improvement of active; of parks and of centres of services; the subjects covered by the General Law of associations, cooperatives and falling within article 6 of this law;
(c) entities and trusts funded by the State of El Salvador, international organizations or foreign Governments;
(d) persons exempt from tax on income by provision of law;
e) the subjects referred to in article 76 of this law, during the first three years of the beginning of its operations, provided that the activity has been lodged with new investments, excluding those cases where procurement of assets or rights are pre-existing. The period shall run from its registration in the registration and Special Control of contributors to the Treasury;
(f) the taxpayers in a particular sector of the economic activity that exceptional circumstances have been affected in their operations, existing Declaration of a State of public calamity and disaster by the Legislative Assembly, State of emergency was declared, in his case, by the President of the Republic, in accordance with the respective legislation, or by reason of unforeseeable circumstances or force majeure; and, g) taxpayers who obtained incomes taxed up to one hundred fifty thousand dollars ($150,000.00) in the year or period of taxation.

4. for the purposes of the application of the above exemptions, taxpayers must file an affidavit with the form determined by the tax administration; for cases of exceptional economic conditions, unforeseen circumstances or force majeure must be accompanied of the means of documentary evidence proving such ends. The tax administration may exercise its powers for the verification of the content of this Declaration. * DECLARED unconstitutional clearance and Declaration of the payment minimum Art. 79.-the taxpayer will liquidate and declare the minimum payment of the tax on the income, in the same statement of the tax on the income of the exercise or corresponding taxation period.
* DECLARED unconstitutional payment of the tax on the income Art. 80.-the tax on the income to pay in the exercise or period of imposition, will be equal to the amount greater that is of compare the payment minimum of the tax on the income according to it willing in the article 77, with the tax calculated on the income net of conformity to it established in them articles 37 and 41. * DECLARED unconstitutional accreditation and return article 81.-income tax determined according to the previous article, will you be credited amounts of payment to account and deductions to which the taxable person has the right. If the settlement is tax liquid in favor of the State, this must be paid within the legal time limit set in this law; There is a balance in favour of the taxpayer, shall apply as regulated in the tax code.
The amount of minimum payment on the net assets which exceeds the income tax a year or period of taxation and who has been paid, may be established in future periods or periods of taxation to the subject option passive against: to) the amount of the whole of the income tax payment, until their exhaustion during the three financial years or periods of imposition following immediate;
and, b) the amount of the tax which is paid during the three financial years or periods of imposition following immediate.
"The remnants of the minimum payment concerning the net assets that are not accredited as regulated in this article, shall be considered as a deductible expense for purposes of the income tax for the year or period of definitive settlement that concluded the period referred to in the present provision." * declared unconstitutional article 2.-merge article 132-B, among the Arts. 132-a and 133, in the following manner: "article 132-B. - repealing exemptions with regard to the income tax, contained 5"

in article 8 of the printing Act, Legislative Decree N ° 12, on October 6, 1950, published in the official journal N ° 219, take N ° 149 of October 9 of the same year and its corresponding reforms.
The present repeal does not apply to exemptions laid down the book."
Entry into force article 3.-the present Decree shall enter into force eight days after its publication in the official journal.
GIVEN in the blue room of the Legislative Palace: San Salvador, at thirty-one days of the month of July in the year two thousand fourteen.
OTHON SIGFRIDO REYES MORALES, PRESIDENT.
ENRIQUE ALBERTO LUIS VALDEZ SOTO, GUILLERMO ANTONIO GALLEGOS NAVARRETE, SENIOR VICE PRESIDENT. SECOND VICE PRESIDENT.
JOSE FRANCISCO MERINO LÓPEZ, LORRAINE GUADALUPE PENA MENDOZA, THIRD VICE PRESIDENT. FOURTH VICE PRESIDENT.
CARLOS ARMANDO REYES RAMOS, FIFTH VICE PRESIDENT.
WILLIAM FRANCISCO MATA BENNETT, MANUEL VICENTE MENJIVAR ESQUIVEL, FIRST SECRETARY. SECOND SECRETARY.
SANDRA MARLENE SALGADO GARCÍA, JOSÉ RAFAEL MACHUCA ZELAYA, THIRD SECRETARY. FOURTH SECRETARY.
IRMA PALACIOS LOURDES VASQUEZ, ERNESTO ANTONIO ANGLE MILE, FIFTH SECRETARY. SIXTH SECRETARY.
FRANCISCO JOSE ZABLAH SAFIE, JOSE SERAFIN RODRIGUEZ ORANTES, SEVENTH SECRETARY. EIGHTH SECRETARY.
Presidential House: San Salvador, at thirty-one days of the month of July in the year two thousand fourteen.
PUBLISHED, Salvador Sanchez Ceren, President of the Republic.
Juan Ramon Carlos Enrique Caceres Chavez, 6 Minister of Hacienda.
D. OR. No. volume 142 No. 404 date: 31 July 2014 JQ/geg 01-09-2014 unconstitutional: * LA SALA DE LO constitutional of the Supreme Court, by means of decision No. 98-2014, published in the D. O. No. 71, T. 407, 22 April 2015, declares unconstitutional the ART. 77, because violates the principle of equity tax in his MANIFESTATION of capacity economic - ART. 131 ORD. 6 ° CN.-AS SOON AS DETERMINES THAT THE ACTIVE NET IS IT BASE TAXABLE OF THE PAYMENT MINIMUM OF THE TAX ON THE INCOME, WITHOUT IN THE CALCULATION OF THAT, EXIST THE POSSIBILITY OF DEDUCTION OF THEM COSTS AND EXPENSES NECESSARY FOR THE PRODUCTION OF IT INCOME AND IT CONSERVATION OF ITS SOURCE; AND BY CONNECTING THE ARTS. 76, 78, 79, 80 AND 81, AS SOON AS IS BOUND TO COMPLEMENT OR DEVELOP THE PAYMENT MINIMUM OF THE TAX ON THE INCOME, SO SHARE THE VICE OF CONTRAST. (JQ/21/05/15)
21/05/15 JQ INDEX LEGISLATIVE