Mexico improved its tax environment the most, while Ecuador deteriorated most.
BY RUTH BRADLEYSANTIAGO — Two of Latin America’s fastest-growing countries – Chile and Brazil – are poles apart when it comes to paying taxes. According to the second annual Latin Tax Index from Latin Business Chronicle, Chile has the region’s best tax environment and Brazil by far its worst.
The index uses four factors – corporate tax rates, tax rates as a percentage of profits, the number of payments involved and the time required – to compare both the level of taxes and the ease or difficulty of payment across 18 countries.
Chile, which also headed the index in 2010, scores well across all four factors while Brazil, which also brought up the rear in 2010, falls down badly on the complexity of its tax regime. Paying taxes there takes 2,600 hours a year – or 325 working days – the longest time in the region after Bolivia with 1,080 hours.
Three countries have seen a significant improvement in their tax environment over the past year, most notably Mexico (now in 10th place) where the time required dropped to 404 hours, down from 517 hours in 2010. In two countries – the Dominican Republic (4th) and Ecuador (12th) – there was, however, a clear deterioration due, respectively, to an increase in taxes as a percentage of profits and to an increase in the time required.
THE TAXMAN’S SLICE
At 17 percent, …
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