Recommended book chapter: Tax reform in Honduras

👷‍♀️ Why do tax systems go through “reforms”? In fact, at what point does an adjustment to a particular tax or set of taxes in a system become a “tax reform”?

In recent years, LatAm countries have witnessed (and are witnessing) significant reforms of their local tax systems. Brazil is going through that process in relation to its five indirect taxes, four of which will be converted into two, three or more in a step-by-step implementation process to be concluded in 2033. Colombia approved via Law 2,277 of 2022 a tax reform that increased taxes on certain categories of income (among other provisions). Ecuador’s Organic Law of Economic Development and Fiscal Sustainability, published in November 2021, established a “solidary contribution” to be paid by local companies on their assets if those exceeded the net amount of USD 5 million.

Another LatAm country that went through a local tax reform is Honduras. In the past, LATPF published a formal opinion on the terms of the then-proposed text (available in Spanish here: https://bit.ly/3TCKTi8). Roberto Ramos Obando, who recently wrote an article for Tax Notes about the so-called Honduran “Tax Justice Law” (available here: https://bit.ly/3x2pDcU) now released the PDF of a book chapter he wrote on the same topic. The book chapter is actually broader than Obando’s article for Tax Notes since it provides a very interesting historical background of the political decisions that (1) crippled the control of tax benefits provided by the government and (2) provided a rationale for the discussion and approval of the bill of law.

The PDF of the book chapter is attached to this post. It is a part of the book titled “América Central: El derecho ante democracias desafiadas”, which was edited by the Max Planck Institute for Comparative Public Law and International Law and coordinated by A. Bogdandy, M. Antoniazzi and Alina Ripplinger. The book is also freely available as a PDF on the website of the Corte Interamericana de Derechos Humanos Corte IDH: https://lnkd.in/e38kcdTm 🌎

If you are interested in reading more about tax reform initiatives in LatAm, here is a short list of articles recommended by the Latin American Tax Policy Forum (LATPF):

➡ “Os impactos da reforma tributária para o agronegócio” (“The impacts of the Brazilian tax reform for agribusiness”), by Anderson Trautman Cardoso. Published by JOTA (2024). Available at: https://bit.ly/3Ygdoom

➡ “El impuesto sobre la renta de las personas naturales en la Ley 2277 de 2022” (“The personal income tax in Law 2,277 of 2022”), by Alejandro Delgado Perea. Published by Universidad Externado de Colombia (2023). Available at: https://bit.ly/3LEvJ7k

➡ “Legislar sin datos: El problema de las reformas tributarias chilenas” (“Legislating without data: The problem of Chilean tax reforms”), by Gonzalo Vergara, Rocío Cantuarias, Marcelo Matus F. and Jorge Montecinos. Published by Universidad de Concepción (2020). Available at: https://bit.ly/3zWmUD6