The Ministry of Finance announced new tax measures, as part of initiatives to support SMEs and companies hit by economic crisis caused by the pandemic. One of these measures includes the extension of the suspension of Provisional Monthly Payments (PPM) during the months of July, August and September, for all companies that register a decline in gross income equal to or greater than 30% for the January-May 2020 period, compared to the same period last year.
The government of Chile has cut the salaries of 693 of its members. The cuts ranged from 1% to 25%. President Piñera’s salary was cut by 10%, while 55 Members of The House, 43 Senators and 24 Ministers had their salaries cut by 25%. The President has set up a special Advisory Board (Consejo de Alta Dirección Pública) to take on the job of coming up with the percentage cuts to make sure that it would not be considered a conflict-of-interest. If the president signs the off on this new measure, it would allow for additional cuts for around 10,000 public servants’ salaries.
The Official Gazette published a series of modifications made by the Ministry of Finance to the regulations of the Guarantee Fund for Small Business Owners (Fogape), with the aim of improving the delivery of credits in the midst of COVID-19. The main changes introduced are the reduction of the deductible and the extension of guarantees for small businesses.
The congress-approved project which seeks to benefit customers of basic services, avoiding cuts for non-payment in water, electricity, gas by network and telecommunications accounts, has been delayed due to controversy. As a result, the only options are to enact it or veto it. PULSO projects that the government will veto the basic services project and return it to Congress with various qualms.
Chile’s Government drafted a law to enable the Central Bank to buy bonds issued by the country’s treasury in the secondary market. The finance minister said that the Central Bank would be allowed to buy the state-issued debt in “exceptional circumstances” under newly drafted legislation. Chilean law currently prohibits the Central Bank from acquiring debt issued by any state organisation, or from financing public spending through direct or indirect credit.
By 37 votes in favor, 1 against and 3 abstentions, the Senate chamber approved the modifications introduced to the bill that establishes a benefit for independent workers who have been affected by the pandemic. This initiative circumvented its third and final legislative process, with which it was dispatched from Congress and is ready to become law. The initiative increases the subsidy to CH$100,000 ($124.75).
A Chilean regulator dismissed the concerns voiced by union workers that mining companies were failing to enforce sanitary measures to combat the spread of the coronavirus, calling mine adherence to the restrictions “adequate.” Chile´s Geology and Mining Service (Sernageomin) told Reuters in an emailed statement it had carried out 4,299 inspections at various mining sites throughout the world´s top copper producer since the outbreak began in mid-March with positive results.
According to a statement given by the Chilean government, “President Sebastian Pinera has decided to extend the state of emergency, which has been introduced in the country since March, for another three months to contain the spread of a second peak of coronavirus”.
Chilean Finance Minister Ignacio Briones announced a fresh, two-year, $12 billion citizen support and economic stimulus package to overcome the effects of the pandemic. The economic plan, funded by a mix of budget reallocations, sovereign funds and debt issuance, includes bolstered emergency benefits for Chile’s most vulnerable families from payments of 65,000 Chilean pesos to 100,000 ($126) per person.
The Senate Chamber approved the report the report issued by the mixed commission that prohibits companies that deliver basic services – water and sewage, electric power, gas and telephony – from cutting off supplies while the Covid-19 crisis spreads in the country. With this approval, the law is ready to be enacted.