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An important step was taken this Thursday by counterproposal of the Government for the withdrawal of pension savings: it was approved, by a large majority, by the Senate, in its first legislative process.
The bill, which underwent important modifications, obtained 35 votes in favor -at least 15 from the opposition-, and only one against and five abstentions.
Before its vote in the Chamber, in its passage through the joint Finance and Labor commissions, the initiative was modified in almost all its points, being very different from what was originally proposed by La Moneda and resulting the closest thing to the first withdrawal.
In that process mandatory withdrawal removed and it was also left without the exclusions it established for those who could withdraw funds, leaving it universal.
Likewise, the maximum to be extracted was increased, from 100 to 150 FU -like the first withdrawal-, and the payment terms were reduced in two installments: from 60 business days for the first and 10 days for the second, it was reduced to 15 business days for the first and the same term for the second.
✅ Approved I By 35 votes in favor, 1 against and 5 abstentions, the Senate Chamber supports in general and in particular the government bill that allows the withdrawal of pension funds.
Keep going. There are separate voting requests and directions. pic.twitter.com/xmQLyZIYuG
– SenadoChile (@Senado_Chile) November 26, 2020
SEPARATE VOTING WITHOUT FRUIT
Then other votes on the project took place, after senators asked to analyze other points separately.
One of them was regarding an indication from Senator Carlos Bianchi, who wanted to leave the payment in a single installment, however, he later decided to withdraw his request. Thus, the project was left with the two quotas proposed by the Government.
Another pending vote was a indication of senators Bianchi, Adriana Muñoz (PPD) and Yasna Provoste (DC), which advocates exempt from paying taxes for the withdrawal of funds. However, it was declared inadmissible since modifications in tax matters are the power of the Executive.
Thus, the Executive’s initiative was dispatched to the Chamber of Deputies and Deputies for its second process.
THE DISCUSSION ABOUT TAXES
The first withdrawal exempted all those who withdrew from taxes, while in its project, the Government does not exempt anyone from whom, according to the law, they must pay according to their income level: currently, those with income from approximately 700 thousand pesos.
The Minister of Labor, Maria Jose Zaldivar, said that “a person who has a salary of 6 million pesos and withdraws the maximum, which is 4.3 million, will pay 1.5 million taxes, and we are going to prevent the State from giving him a tax exemption for another 1 , 5 million more if you invest it in an APV. This is extremely relevant and it has not been taken the weight “.
In turn, the owner of the Treasury, Ignacio Briones, stated that “a person who earns 1.5 million pesos, and withdraws one million, is going to pay approximately a tax equivalent to 3,300 pesos per month for a year, 40 thousand pesos per year. I ask if that is really a super tax “.
Furthermore, he stated that “A person who earns 1.5 million pesos, whether we like it or not, is in the top 10 percent of income in our country; He is not the richest, but he is in position 90, and the richest person is the one in 100 “.
The Executive’s position was criticized by the Senator Provoste, one of those that promoted the failed indication to exempt the withdrawal of funds from taxes. After all, it seemed to be a way of calling on the government to modify its initiative and exempt those who earn less from taxes.
He also accused “double standard of this Government, and in particular, the Minister of Finance, because the Internal Revenue Service is under his authority, and today they come to pay attention to low incomes and say that ‘this is a gift’, as someone said out there, no gentlemen , the gift is being given to large companies, Penta, Ponce Lerou, Jonhson, Pascua Lama “.
📌 Single retirement of pension funds advances to the Lower House.
With 35 votes in favor, one against and five abstentions, the congressmen supported the idea of legislating and the articles of the project presented by the Executive. Https://t.co/4gqb6Lao3p pic.twitter.com/LQEB1Ddxq3
– SenadoChile (@Senado_Chile) November 26, 2020
Earlier, the same Senate rejected -in second process- the constitutional reform originated in the Lower House to promote the second withdrawal, which the Government has already challenged before the Constitutional Court. In this way, this text will go to a mixed commission of senators and deputies.
Key to this was the withdrawal of the five pro-government senators who had pledged their vote for the constitutional reform, but who finally ended up supporting the government’s initiative.
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