Honduras New Tax Code Draft Presented to President Hernandez

The business sector in Honduras responded favorably to the decision made by President Juan Orlando Hernandez to restructure the Executive Directorate of Revenue (DEI) and develop a new Tax Code to strengthen the collection agency.

Honduras "DEI" - Direccion Ejecutiva de Ingresos

Honduras “DEI” – Direccion Ejecutiva de Ingresos
2015 Record Tear for Tax Collections

“I think these actions will rise from 15 to 20 points the competitiveness indices,” says Aline Flores, president of the Honduran Council of Private Enterprise (COHEP).

Flores adds that efforts should be integrated to promote sustainable jobs, decent wages and benefits.

The global competitiveness index compiled by the World Economic Forum (WEF),  shows Honduras climbed 12 spots to place 88th out of 140 economies studied in 2015.

Honduran Council of Private Enterprise (COHEP).

Honduran Council of Private Enterprise (COHEP).

Emin Jorge Abufele, president of the Chamber of Commerce and Industries of Cortés (CCIC), described as positive the initiative to create a new Tax Code in the country, since the current has brought serious problems between employers and the DEI.

“We we have been asking the Government for a new simplified tax code aimed at promoting the investment process.”

"CCIC" Chamber of Commerce and Industries of Cortés, Honduras

“CCIC” Chamber of Commerce and Industries of Cortés, Honduras

“We are very attentive and see the new directive for a new tax code favorably providing that the DEI is restructured and new, more professional, stronger and efficient; as long as this new institution will seek to facilitate trade with monitoring tools, because if we continue with the same practices nothing will change,”

stated Raul Lopez Fonseca, president of the National Federation of Customs Brokers of Honduras (Fenaduanah).
In his view, modern tax codes should be clear, concise, accurate and summarized.

“The fiscal situation in Honduras has become pandemonium. That is, companies must have a tax specialist to avoid falling into traps, fines or penalties. The documents shall be according to trade facilitation, control and other key aspects from global trends. “

López Fonseca reiterated the denunciation of Fenaduanah due to the absence of qualified personnel to provide efficient customs clearance service of cargo arrival and export at the port in Puerto Cortes.

National Federation of Customs Brokers of Honduras (Fenaduanah)

National Federation of Customs Brokers of Honduras (Fenaduanah)

“If you are going to change the personnel, they must be trained in advance. You can not put newly recruited and trained personnel in such technical positions, such as ports and customs duties employees. I do not know if the DEI has considered that.”

In similar terms, prominent business leader and employer Luis Larach, has stated that the new tax initiative should promote attraction of new investment and job creation.

“This is done through competitiveness. If we are not competitive at the regional level we will never achieve what all Hondurans want: more jobs. “

Miriam Guzman, the Director of the DEI, yesterday gave a press conference in which she confirmed that the draft of the new Tax Code is already in the office of President Juan Orlando Hernandez.

Honduras "DEI" - Director Miriam Guzman

Miriam Guzman, Director of the Executive Directorate of Revenue

“The only goal is to give Honduras a tax efficient, facilitative, transparent and balanced management service, because only then will we achieve the goal of becoming attractive and competitive in the eyes of domestic and foreign investors.”

The new regulatory document collection system is based on the current rules, in addition to the Model Tax Code which was prepared by the Inter-American Center of Tax Administrations (CIAT), and made available since last May.

“It is a standard code and model we tropicalized to the Honduran reality and we have worked on that basis. It is totally false that it is the Ecuadorian model, although for me it’s one of the best in Latin America.”

The new Tax Code has been developed by experts from the DEI, the Ministry of Finance, and the Central Bank of Honduras (BCH).

“I understand and accept that it will be socialized by others, so that in the shortest possible time, be sent to the National Congress and approved by the plenary of the legislature,”

Guzman continued.

Guzman, the Director of the DEI, guarantees that all current personnel working for the state will get their earned benefits (prestaciones).

“This is a process where a good employee stands to gain setting a good example for the institution by having guarantees and stability. This new initiative will provide a range of benefits that make it more attractive to work at the DEI.”

Guzman made it clear that all employees are subject to the tests of confidence during the process of restructuring and that will dictate their staying on with the newly reorganized institution.

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