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More Bad News For Tax Plan

June 3, 2005

LAST week, legislators voted in favorof applying a fast-track procedure to thetax reforms that have already spent threeyears in the Legislative Assembly (TT,May 27). This week, however, the 18assembly members from the SocialChristian Unity Party (PUSC) – the partythat has been the plan’s primary proponent– proved to be split in their opinionsabout the reforms. The bone of contention:whether the Permanent FiscalReform Package, as it is formally known,helps or harms the nation’s poor.Gerardo González, a PUSC memberand president of the assembly, told LaNación he thinks the tax plan will hurt thepoor and should be modified before beingpassed. Fellow assembly members MiguelHuezo, Federico Vargas and GloriaValerín said they and nine other PUSClegislators agree with this position. If theirclaim is correct, PUSC supporters of theplan are in the minority within the assembly.Mario Redondo and Olman Vargas,members of the commission that analyzedthe tax plan, are part of a group of PUSClegislators who say the plan will benefitthe poor, according to the daily.This is the position of President AbelPacheco, also a PUSC member. He hasvigorously promoted the plan since sendingit to the assembly in 2002, and maintainsthat it would create a more equitabletax scheme in which the rich shouldermore of the burden.Redondo told the daily González doesnot understand the plan. Valerín, in turn,said Redondo and Vargas have refused totake into account their fellow PUSCmembers’ suggested modifications.

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