A tax reform… urgent!

Lorenzo Gabriel Dávalos Baigorria

A tax system is not something that changes every moment; However, after many years of its application and with a different scenario from an economic point of view, the current system presents different limitations, it does not accommodate the mandates of the new Constitution, in a State with autonomies, nor the challenge of generate greater income. It remains to move forward with a tax reform that allows compliance with the duty to pay taxes in proportion to economic capacity, under the principles of equality, progressivity, redistributive justice and the common good.

Tax pressure shows sustained growth, as a result of the technological applications of the Tax Administration with its new SIAT online billing system; as is also the result of the expansion of economic activity in general.

On the other hand, the performance of collections as a result of the inspection processes, both in mass and selective processes, increases in each management and grossly in these last two managements. But it must be taken into account that the central objective of the audit is not to achieve greater collections, but rather its actions must be aimed at generating a greater sense of risk not only in the taxpayers who are part of the registry, but also in those who develop informal activities, which will contribute to forming a citizen consciousness that allows all members of society to contribute to the State under principles of generality, universality, equity and solidarity.

We have an average of 35 to 40 new Regulatory Resolutions of the RND Directory per year, which connotes that the current tax system is obsolete and these RND’s are patchy solutions and even unconstitutional in some specific cases. The implementation of a new tax system, the creation of a taxpayer ombudsman, the definition of a new tax structure and regime, as well as a new model for the distribution of tax resources, are urgently required.

The new tax system must have as its fundamental basis the provisions established in the Political Constitution of the State related to the territorial organization, the powers, the competencies, the economic structure and fundamentally the tax powers granted to all the Departments of the Country, which not only They must be simple recipients of transfers, but also be responsible for generating and managing resources from the collection of taxes, for which it is necessary that Power be Transferred from the Central level of the State so that the autonomous governments can administer taxes that are intended taxable on the generation of personal income, specific consumption, such as the aforementioned tobacco, beer and others, and special consumption such as gasoline consumption in the case of departmental governments and the Tax on Gambling Activities, Sweepstakes and Business Promotions in the case of the municipalities; which means, in turn, the corresponding modifications in the resource distribution and sharing regime, which must take into account as a calculation variable the fiscal effort made by the respective level of government.

This reform would guarantee and deepen the future advances achieved in the social and economic sphere, so that they are not vulnerable to adverse international contexts due to the sale of natural resources, and project structural improvements in the quality of life of society. Such purpose requires the contribution and responsibility of all the country’s citizens, and the efficient and transparent use of these resources by State administrators. This article is the beginning of a new tax system in Bolivia from the analysis of the current situation to the formulation of proposals. Caeco aims to contribute to the debate and design of public policies that contribute to the construction of a hopeful future.