Friday, February 20, 2009

Hike in Vehicle Import Tax Delaying Tax Reform Package

Some legislators are proposing a postponement of discussions of the "first registration tax" on vehicles, which is part of the tax reform package before the Guatemalan congress. There is great difficulty in reaching agreement on the percentage to be charged and the vigorous debates are holding up the overall tax reform process.

One of the arguments against the new "first registration tax" is that it makes no sense to charge the same tax rate on used and new cars. The strongest resistance to the tax comes from the union of used car importers, who ship severely damaged or totaled cars from the United States to Guatemala, where they are repaired and put back on the road.

The Guatemalan Treasury reported that in the first six weeks of 2009, tax revenues declined by Q100 million, so there is urgency to get the reform bill passed, with or without the "first registration tax" provision.

See details in previous story on this topic.

Democratic Freedom Party Submits Security Proposal

The Democratic Freedom Party (Bancada Libertad Democrática) is working on a congressional bill concerning national security.

Their goal is to start with a "clean slate", with the creation of a ministry and a security force which would replace the National Police (PNC). "Existing structures have been co-opted by organized crime and corruption. We need a new scheme," said Congressman Manuel Baldizón yesterday.

Pope Names Ambassador to Guatemala

Pope Benedict XVI appointed Archbishop Paul Richard Gallagher as Apostolic Nuncio (Vatican Ambassador) to Guatemala. Archbishop Gallagher previously held that position in Burundi.

Gallagher, 55, replaces Bruno Musaró, who was appointed earlier this year as the nuncio to Peru. Gallagher was born in Liverpool (Great Britain) in 1954 and was ordained priest in 1977. He earned a degree in canon law in 1984 and entered the diplomatic service of the Holy See. He has served in Tanzania, Uruguay and the Philippines. In 2004 he was appointed nuncio in Burundi, and Archbishop of Holdelm.

On July 15, 2000 he was appointed by John Paul II to be the special envoy and permanent observer at the Council of Europe in Strasbourg.