Chile: controversial tax on “super rich” advances in Congress

A controversial project in Chile which proposes increase by 30% the tax on companies with income above one million UF (Unidad de Fomento), or approximately $ 41 million, and paying homage to the legacy of the so-called “super rich” 2.5% advance to Congress of the South American country.

According to projections, approximately $ 1,008 million is expected to disburse the 8 richest families and groups in ChileIn the event that the tax on the “super rich”, as it has been called, is definitively approved, and which is currently being debated in parliament.

The rough estimate was released by the media Interference, then the classification Forbes publish this Chilean top 8 fortunes increased their assets by $ 40.3 billion in the midst of social and economic crisis unleashed by the coronavirus pandemic. The above represents an increase of 73% when compared with the international list for the year 2019.

Tax offers a one-time tax charge of 2.5% for people with assets over $ 22 million. This initiative was strongly rejected by the Chilean government, whose president Sebastián Piñera is part of this list of the 8 most eminent millionaires of the country, with a fortune of around 2,900 million USD.

The government warned that after the approval of this initiative to the constitutional commission of the lower house, appeal to the Constitutional Court for me to settle this discussion because “As long as the Constitution is in force, the government will ensure that its prerogatives are respected.”

But, How much will some of the biggest Chilean tycoons have to pay, if the “super rich tax is approved?” What could happen after all the planned money has been collected?

What could be raised

According to the projection, with the $ 1,008 million that could be raised with the tax on the “super rich”, “8 complex hospitals” could be financed in the country. On the other hand, they could also be used to create “7.2 million minimum emergency income of 100,000 pesos (USD 142), which is equivalent to 7.3% of the 2021 health budget ”

The richest and most important clan in Chile, the Luksic family, which is commissioned by Iris Fontbona, considered “the richest woman in Latin America”, occupies the first national position and the 74th place in the list of Forbes. With a net worth of $ 23.3 billion, if the “super rich” tax is finally approved, the Luksics would have to allocate about $ 582.5 million of their wealth.

Only with the money raised by this family, “4.2 million minimum emergency income” could be funded. The amount collected is also equivalent to “4.2% of the annual health budget in the country”, or about 12.7 billion USD according to the 2021 budget bill.

On another side, President Sebastián Piñera ranks fourth nationally and 1064 on the Forbes list. With a net worth of 2,900 million USD, it is considered that if this tax is approved, The president will have to contribute $ 72.5 million, which could help finance a very complex half-hospital, whose average cost is 138 million dollars, if the construction plan prepared by the government of former President Michelle Bachelet is maintained.

Another tycoon who would have to shell out large sums of money in case the tax of the “super rich” in Chile becomes a reality, is Julio Ponce Lerou. According to estimates, the owner of the mining company SQM, and historical financier of Chilean politics, is expected to contribute $ 102 million out of its total capital of $ 4.1 billion.

As, German-born millionaire Horst Paulmann is expected to provide $ 82.5 million, but it is estimated that this figure would be lower because its main source of income, the company Cencosud, “It is a diversified company with significant branches in Peru, Argentina, Colombia and Brazil, where this tax does not apply.”

In the case of brothers Roberto and Patricia Angelini, they are expected to jointly disburse around $ 90 million, while Álvaro Saieh, founder of the CorpGroup group and owner of the journalistic company Copesa, is expected to extract $ 45 million from his pocket to help reduce the economic crisis triggered by the pandemic.

Finally, the banker Luis Enrique Yarur, owner of Chilean bank Banco de Crédito e Inversiones (BCI), is expected to extract of his fortune of 1.3 billion USD, approximately 32.5 million USD in case the tax on the “super rich” continues to rise in parliament.

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