Congress’s permanent commission has approved the Executive bill to reduce the general sales tax, IGV, to 18 percent from 19 percent.
The bill was approved in the first vote, with the support of 24 lawmakers, daily El Comercio reported.
The commission also approved a decrease in the banking transaction tax, ITF, to 0.005 percent from 0.05 percent.
Prior to the vote, President Alan Garcia said he was “convinced that the great majority of the country is in agreement,” with the decrease in the tax.
Most of the presidential candidates have approved the decrease of the IGV, which was first implemented in 1982 – at a rate of 12 percent – by Finance Minister Ismael Benavides when he was vice-minister of the public treasury.
Benavides has said the measure will result in lower prices and save consumers 500 soles (about $180) a year.
However, the president of the Peruvian Association of Consumers (Aspec), Crisologo Caceres, has challenged the figure. “I wonder where he got that figure from,” Caceres told Radioprogramas. He added that lowering taxes in Peru has rarely resulted in savings for consumers.
