In the fiscal (tax) reform that the government will submit to the National Congress shortly, basic foodstuffs that make up the family basket will not be taxed, President Danilo Medina promised yesterday, Tuesday 2 October. After a 15-minute meeting with the leaders of the country’s main unions, the President also pledged to maintain the incentives, among other things, currently enjoyed by the free trade zones.
At the end of the meeting, CNUS president Rafael (Pepe) Abreu pointed out that the visit to the Presidency was motivated by reports that some businesspeople have been suggesting that all items in the family basket should be taxed in the new tax reform, even the ones that the people eat most. Abreu mentioned beef, pork and poultry, rice, beans, bread, milk, plantains, and yuca (cassava) along with other products that were supposedly targeted by some sectors for the application of new taxes. The union leader said that things had gone so far that Medina told him that other mass consumer goods would be taxed, but he (Danilo Medina) decided to remove them so as not to affect the poor.
Government overspending in this electoral year has led to a fiscal deficit that the new Medina administration has to cover in order to pay governmental debts and maintain the administration’s high spending levels.