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Chilean President abandons his fiscal reform and presents new proposal

Chilean President abandons his fiscal reform and presents new proposal
Photo: MSM

August 2|

Chilean President Gabriel Boric said on Tuesday that his government will not insist on a rejected tax reform bill and will promote new initiatives to raise the necessary funds to address some of its promised social proposals.

In June, the leftist ruler had said that his government would insist at the end of July in the Senate to resume the legislative processing of the tax adjustment.

Through a new Fiscal Pact, Boric said that the spending proposals involve resources for 8,000 million dollars to finance programs such as the Universal Guaranteed Pension to improve the lowest pensions, reduction of waiting lists in health, as well as greater investment in citizen security.

“This proposal considers the contribution made by growth, the reform of the state, the strengthening of tax oversight and taxes paid by the higher income sectors to be able to finance in this way the social expenses that are urgent,” he said in a televised speech.

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“We are not going to insist in the Senate with the bill that was previously rejected”, he added.

Boric did not specify deadlines for the delivery and processing of the initiatives, or how much the total collection is expected to be.

The government’s new proposal will be divided into two projects, one to improve tax compliance and the other to adjust income tax focused on those with greater resources.

“This initiative will also include tax incentives for investment, productivity and formalization, as well as benefits for the middle class and a new regime for smaller companies,” he said.

He specified that the tax incentives would be equivalent to 0.5 points of the Gross Domestic Product (GDP).

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The first project includes measures that seek to increase tax collection through legal modifications that do not imply a tax increase, which would increase tax collection by 1.5% of the GDP in net terms, according to a government minute.

Meanwhile, the second will be focused on income tax for both companies and individuals and will include incentives for investment, productivity and formalization, as well as benefits for the middle class and the new tax regime for smaller companies, which would have a fiscal cost of 0.5% of GDP.

At the investment level, tax incentives such as semi-instantaneous depreciation and a tax credit fund for investments with a multiplier effect on activity, employment and environmental sustainability are proposed.

It also commits to reduce by 30% the processing time for mining projects, according to the minutes.

Additionally, the plan includes five priority areas of productive diversification that by 2026 foresees three or four new lithium projects, two thirds of the energy matrix with renewable sources, 10-12 projects in the development of green hydrogen and an increase in the digital economy.

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The original tax reform bill was rejected in March by the deputies and the government could only insist on its passage through the Senate.

International

Rush for Air Conditioners Sparks Tensions at French Supermarkets Ahead of New Heatwave

Scenes of long lines, overcrowded stores and customer disputes unfolded across France on Thursday as shoppers rushed to buy air conditioners and fans ahead of another expected heatwave.

The buying frenzy comes as the country continues to recover from last week’s extreme temperatures, which exceeded 40°C (104°F) in several areas and produced the warmest night on record, with an average temperature of 22°C (71.6°F). Authorities have linked the heatwave to at least 1,000 excess deaths.

Demand for cooling appliances has surged in recent days, prompting heavy traffic at appliance retailers. The situation intensified on Thursday when German discount supermarket chain Lidl launched a promotion on portable air conditioners and electric fans.

Videos shared on social media showed large crowds gathering outside stores, with customers pushing and rushing to secure the discounted products.

“Lidl France regrets the incidents that occurred in its stores,” the company told AFP, adding that employees were forced to manage tense situations in what it described as a challenging environment.

Outside a Lidl store in northwestern Paris, dozens of customers began lining up as early as 7:00 a.m., two hours before opening, while police monitored the crowd, according to an AFP journalist at the scene.

Although many shoppers remained in good spirits, tensions escalated as some people attempted to cut in line. “I will not open the store until they leave,” a store manager reportedly shouted as frustrated customers protested.

The situation worsened after customers discovered that the store, located in a working-class district of Paris, had only two air conditioning units available for sale.

One of the successful buyers, Lassana, who declined to provide his last name, said he had queued since 4:00 a.m. to secure one of the units.

Another customer, 69-year-old Fatou, was only able to purchase a small fan after what he described as a struggle. He criticized Lidl’s advertising as “misleading,” claiming police had temporarily closed access to the store because of the crowds.

Lidl France attributed the shortages to its fixed annual purchasing cycle, explaining that the promotional products had been ordered a year in advance and were offered at predetermined prices, limiting the available stock.

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International

Peru Expands Emergency Measures Ahead of Heavy El Niño Rains

Peru has declared a state of emergency in 796 districts across 22 regions due to the imminent threat of heavy rainfall linked to the El Niño weather phenomenon, the government announced on Thursday.

El Niño, which causes unusually warm sea surface temperatures in the Pacific Ocean, disrupts global wind and rainfall patterns, often triggering extreme weather events. In Peru, the phenomenon has already driven temperatures up to 26 degrees Celsius, around five degrees above the seasonal average.

According to Peru’s National Center for Disaster Risk Estimation, Prevention and Reduction (Cenepred), more than 9.3 million people are at very high risk of flooding and landslides associated with El Niño.

Interim President José María Balcázar signed a decree extending an emergency measure that has been in effect since January, allowing authorities to implement immediate response and recovery actions in affected areas.

Under the decree, regional and local governments, working alongside Civil Defense and supported by national ministries, are authorized to take extraordinary measures to protect communities and critical infrastructure from the expected impacts of heavy rainfall.

“We have declared a state of emergency in 796 districts across 22 regions due to intense rainfall associated with the El Niño phenomenon for a period of 60 days,” the Presidency of the Council of Ministers said in a statement.

Peru is divided into approximately 1,800 municipalities.

The country’s agency responsible for monitoring El Niño recently upgraded its forecast for the phenomenon from moderate to strong for the period between June and September, with conditions expected to persist through the first quarter of 2027.

Scientists at the U.S. National Oceanic and Atmospheric Administration (NOAA) estimate there is a 63% probability of a very strong El Niño developing between November and January, potentially making it one of the most intense events recorded since 1950.

Peru last experienced El Niño in 2023, when flooding and landslides claimed 99 lives.

The country’s most devastating El Niño events occurred in 1997-1998, leaving around 500 people dead and reducing gross domestic product (GDP) by 6%, and in 1982-1983, when approximately 9,000 people died and the economy contracted by 11.6%.

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International

Three Die During World Cup Celebrations in Mexico City After Mexico’s Victory

Three people died in Mexico City while celebrating Mexico’s 2-0 victory over Ecuador at the 2026 FIFA World Cup, local authorities confirmed on Wednesday.

According to the city’s Health Secretariat, the victims—a 44-year-old man, a 48-year-old woman, and a 19-year-old woman—died from asphyxiation following the post-match celebrations.

Emergency services were dispatched to the Juárez district after reports that three people had lost consciousness shortly after Tuesday night’s match.

Paramedics, firefighters, and police officers responded to the scene, where the victims received first aid and cardiopulmonary resuscitation (CPR) before being transported to a hospital for specialized medical care. Despite the efforts of medical personnel, all three were later pronounced dead.

“We are in contact with their families to provide all the support they need,” Mexico City Mayor Clara Brugada Molinasaid in a statement posted on social media.

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“With my hand on my heart, I extend my deepest condolences to their loved ones. We once again call on everyone to celebrate with responsibility, care, and empathy,” she added.

Mexico’s victory over Ecuador sparked massive celebrations at the Estadio Azteca and across the capital. Goals from Raúl Jiménez and Julián Quiñones secured the hosts’ place in the Round of 16, where they are set to face either England or the Democratic Republic of the Congo, who meet on Wednesday in Atlanta.

Should Mexico advance to the quarterfinals, the team would face either Brazil, coached by Carlo Ancelotti, or Norway.

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