Chile Tax Bill Would Aid Compliance But Hike Costs

Tax practitioners welcome Chile’s proposed reform of its transfer pricing laws to boost tax compliance but warn that it may lead to higher administrative costs and increased scrutiny of company practices.

The changes being considered by the Senate Finance Committee are part of a government proposal aimed at reducing tax avoidance and increasing revenue by 1.5% of GDP to fund social spending, according to the Finance Ministry.

“Although the proposals would offer greater clarity and allow proactive adjustments, they might also lead to an increase in compliance costs, more administrative work and a greater risk of correction notices” if companies ...