The experts urge to approve a new bill, as they warned that there is no coherence between what is demanded of the State and the sufficiency of resources that society must provide.
This Thursday, the Advisory Committee of the Fiscal Rule urged to approve a tax reform that generates higher permanent income from 2022 and 2023.
This was stated after analyzing the evolution of public finances and reviewing a preliminary version of the fiscal scenario of the next validity, this in view of the presentation of the Medium-Term Fiscal Framework, which indicates the economic route for the next 10 years.
Also read: Life after losing investment grade
The Committee drew attention to the “delicate situation of public finances and the consequent imperative need to approve a tax reform .” He also recognized the government’s efforts to try to balance the economic reactivation and support for the most affected population while still protecting fiscal sustainability.
This was indicated after learning about some elements of consensus that the Treasury portfolio has been working on with various social, business and political actors.
“Given the current weak economic and social situation, the public debate has suggested the expectation that this project will generate additional permanent income of around 1% of GDP. Although this would be an important effort, if not complemented with additional measures in the medium term , public debt would stabilize at levels that would not be compatible with a macroeconomic environment and interest rates favorable to household consumption, and the recovery of the economy. employment and productive activity ”, the Committee assured in a statement.
Along these lines, he stressed that the fiscal strategy set forth by the Ministry lays the foundations to begin the process of reducing the fiscal deficit as of 2022, taking into account the need for this balance.
You may be interested: Fedesarrollo estimates that the strike would have cost between $ 4.8 and $ 6 billion in May
“It is desirable that the Medium Term Fiscal Framework quantifies these future needs, and their possible sources and timing, in such a way that a credible path of convergence of public debt to the desired levels is built,” he said. .
The experts also consider that the bill should incorporate a debt goal within the framework of the Fiscal Rule, which consolidates the confidence of society in this instrument.
The fiscal rule is the government’s commitment to reduce the difference between the nation’s income and its expenses, a commitment that has traditionally been adopted by recommendations of this Advisory Committee, in which academics, researchers, and congressmen participate.
Follow the news of El Espectador on Google NewsOther economic news today: SIC fines Unilever $ 726 million for misleading advertising
Finally, the Committee called for the commitment of all actors in society to ensure “coherence” between the demands of the State and the sufficiency of resources that the different groups in society must provide.
“ The structural situation of public finances is such that this coherence does not exist , and the new demands arising from the pandemic have widened the gap. Achieving this coherence will require a greater future effort from everyone, including groups in society that have historically contributed below their means ”, he concluded.
