To display this YouTube content, you must allow advertising and audience measurement cookies.
An extension on your browser appears to be blocking the video player from loading. In order to view this content, you must disable it on this site.
First modification: 04/23/2026 - 05:49 Last modification: 04/29/2026 - 23:22
The far-right Administration of José Antonio Kast filed a bill in Congress with which it intends to implement changes in the tax system to, according to the president, encourage an increase in investment and employment opportunities. Its detractors say it could worsen the fiscal deficit.
Waiting for a rocky road in Congress and with the desire to attract investments to the mining country, the new president of Chile launched this Wednesday, April 22, an economic reform whose foundations are based on a gradual reduction in corporate taxes.
President José Antonio Kast presented the "Plan for National Reconstruction and Economic and Social Development", as his Government has called it, before a Congress in which he lacks majorities.
“We propose to gradually reduce the corporate tax from 27% to 23% to generate more investment, and more investment means more jobs,” Kast summarized when explaining the heart of the initiative.
Read alsoKast announces a reform plan to relaunch Chile's economy, with a tax cut for companies
Another of the at least 40 measures included in the proposal is, according to the head of state, "to grant a tax credit that supports the formal employment of thousands of Chileans, with nearly 1.4 billion dollars destined to benefit the formal employment of 235,000 SMEs (small and medium-sized businesses)."
A temporary VAT exemption for new homes and a guarantee of fiscal stability for 25 years for investments over $50 million are other of the most notable points of the project that is now entering legislative discussion that promises debate.
Less tax revenue, more deficit
But, just as it can attract more jobs and generate investments, there are those who are concerned that a reduction in taxes on companies could strengthen the country's fiscal deficit, such as the Budget Office.
The specialized agency Bloomberg cites a financial report that accompanies the 121-page legislation, prepared by this entity, which warns that during the five years following its approval there would be a negative impact on state revenues.
The Kast Government, however, has committed even during the campaign to promoting an austere mandate, with reductions in administrative expenses.
To display this content from X (Twitter), you must allow audience measurement and advertising cookies.
Chilean GDP grew by 2.5% in 2025 and inflation closed at 3.5%, while the structural fiscal deficit was 3.6% of GDP, the highest in two decades, according to official data.
The legislative path is not completely clear: Kast lacks a majority in Congress, which could make the implementation of his agenda difficult. The allied right-wing blocs control just 76 of the 155 seats in the Chamber of Deputies and 25 of the 50 in the Senate.
With EFE, Reuters and local media
Related keywords
The content you requested does not exist or is no longer available.
