RURAL CONCENTRATION TAX WAS APPROVED
At approximately 3 in the morning, after a very extensive session, the senate approved the Rural Concentration Tax (ICIR). Twelve senators who admitted having land abstained from voting, claiming they could be benefited with the approval of the law.
After a very long session with nine points up for discussion, with the decriminalization of abortion as the main topic, the upper chamber voted for the bill that creates the ICIR, which was approved with officialist votes.
The law, which was discussed by the opposition and the rural unions (and with some qualms on behalf of the Minister of Agriculture, Tabaré Aguerre), establishes a tax for owners who have more than two thousand hectares or rural property. The project will become a law since it already has the approval of the lower chamber. The project was approved by 16 votes out of 27, only with votes from the Frente Amplio.
The so called Rural Concentration tax (ICIR) mandates a tax of 67 Indexed Units per hectare (around 8 dollars) for the extension of land between 2000 and 5000; 100 Indexed units (12 dollars) per hectare for extensions between 5000 and 10000 hectares and 135 Indexed Units (16 dollars) per hectare for properties over 10000.
In all the cases the lands that will be taxed are the ones with a coneat index over 100 or equivalent; that is to say that 3.000 hectares with a coneat index of 60 wouldn’t pay taxes, but 1500 hectares with a coneat index of 200 would.
The promoters of the project held that the value of the hectare in dollars has multiplied by 9 in 20 years and that valuation of the land has not been reflected fiscally.
According to government calculations, the new tax would affect less than 1500 of the more than 50000 producers in the country who have more than a third of the 17 million farmable hectares in our territory.
12 out of 31 senators abstained from voting for various reasons, some of them held that since they had land they could be benefited by the law. The second part of the project establishes changes in taxes of land bought before 2007 , which according to La República would include owners such as Pedro Bordaberry, Luis Alberto Heber, Luis Alberto Lacalle, Rodolfo Nin Novoa, Jorge Saravia, Sergio Abreu, Juan Chiruchi, Lucía Topolansky, Tabaré Viera, Heber Da Rosa and Héctor Tajam.
The tax was originally proposed in June by President Mujica who had to overcome obstacles that came from within his own party from the Frente Líber Seregni sector, which held that the new tax “changed the rules of the game” and didn’t really achieve its objective which was to combat the concentration of land.
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