Interpretation of Numeral 1 of Article 113 of the Tax Code
Congreso Nacional
- Decree: 117-2021
- Published: February 14, 2022
- Issuing body: Congreso Nacional
- Gazette: 35,848
- Category: Financial & Tax
Summary
This decree interprets two tax and labor laws to clarify their application. First, it establishes that companies with special fiscal benefits are not subject to transfer pricing rules. Second, it declares that the Aguinaldo (Christmas bonus) is completely exempt from taxes and deductions, benefiting all workers.
Considerations
Whereas the faithful application of legal norms in congruence with their text and the spirit of the legislator is the manner to guarantee legal certainty over state management, therefore it is incumbent to interpret norms when they are applied or intended to be applied in an erroneous or contrary manner to their spirit.
Whereas Article 351 of the Constitution of the Republic mandates that the Tax System shall be governed by the principles of legality, proportionality, generality and equity, in accordance with the economic capacity of the taxpayer.
Whereas it is a priority of the State to combat tax evasion, providing clear laws and interpreting them when confusion arises in their application by the authorities or when doubts arise from taxpayers.
Whereas Article 127 of the Constitution of the Republic establishes that "Every person has the right to work, to freely choose their occupation and to resign from it, to equitable and satisfactory working conditions and to protection against unemployment", and such persons are furthermore subject to a series of other rights that have the purpose of ensuring their subsistence and providing conditions of dignified living, the State being obliged to create the propitious conditions for their fulfillment.
Whereas the Legislative Branch, having as its priority the sovereign will of the people and their welfare, must advocate for the effective application of the laws enacted and ensure the enjoyment of the rights of its citizens, which can be hindered when the institutions in charge of providing public services do not do so efficiently, due to an erroneous application of the Law, therefore the Legislative Branch through its interpretation prevents such situations by giving the Law the original sense of the legislator's intent.
Whereas the provisions contained in laws relating to labor relations must be coherent with the provisions that the Labor Code contains on the same matter, in order to avoid erroneous interpretations that distort their meaning to the detriment of the harmony that must exist in the worker-employer relationship and in the relationships of companies with the State.
Whereas the social compensations contained in Decree No. 112-82 dated October 28, 1982, containing the Law of the Seventh Day and Thirteenth Month in the form of Aguinaldo, are oriented to benefit the worker directly and furthermore the same form part of their salary, with the purpose that upon payment to them of the rights and benefits that labor laws grant them, said social compensations form part of the calculation of the rights or labor benefits and social indemnifications that by law correspond to each worker.
Whereas in accordance with Article 205 Attribution 1) of the Constitution of the Republic, it is within the power of the National Congress: To create, decree, interpret, reform and repeal laws.
Articles
Interpret numeral 1) of Article 113 of the TAX CODE, contained in Decree No. 170-2016 dated December 15, 2016 and published in the Official Gazette "La Gaceta" dated December 28, 2016, Edition No. 34,224 and its amendments; in the sense that said provision when referring to: "1) The Tax Administration or the Customs Administration, as the case may be, for the determination of tax obligations, in accordance with the Law for the Regulation of Transfer Prices, must verify the existence of transfer prices in operations carried out between natural or legal persons domiciled or resident in Honduras with their related, linked or associated parties and those covered by special regimes that enjoy tax benefits; and..." is not including special regimes that enjoy tax benefits within the operations that determine tax obligations related to transfer prices, since the intent of the legislator is oriented toward such obligations applying only to natural or legal persons domiciled or resident in Honduras that are related, linked or associated with companies subject to special regimes and not to the latter themselves.
Interpret Article 3 of Decree 112-82 containing the LAW OF THE SEVENTH DAY AND THIRTEENTH MONTH AS CHRISTMAS BONUS, dated October 28, 1982 and published in the Official Gazette "La Gaceta", Edition No. 23,848 of November 1, 1982, in the sense that: when reference is made to the payment of the Seventh Day and Thirteenth Month as Christmas Bonus integrating the concept of salary for all legal purposes, it is only for purposes of the calculation and payment of benefits, labor rights and indemnifications, which is to say that the Thirteenth Month or Christmas Bonus is exempt from the payment of all taxes, deductions, contributions and withholdings of any kind, except those related to the fulfillment of obligations to provide child support.
This Decree shall enter into force as of the date of its publication in the Official Gazette "La Gaceta". Done in the City of Tegucigalpa, municipality of the Central District, in the Session held by the National Congress in Virtual manner, on the seventeenth day of the month of December of the year two thousand twenty-one. MARIO ALONSO PÉREZ LÓPEZ PRESIDENT JOSÉ TOMÁS ZAMBRANO MOLINA SECRETARY ROSSEL RENÁN INESTROZA MARTÍNEZ SECRETARY To the Executive Branch. Therefore: Let it be executed. Tegucigalpa, M.D.C., ________ of 2021 JUAN ORLANDO HERNÁNDEZ ALVARADO PRESIDENT OF THE REPUBLIC THE SECRETARY OF STATE IN THE OFFICE OF FINANCES
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- Agreement 149-2025 by which article one of Agreement No. 057-2025 is reformed — This law reforms a previous agreement on public debt management and issuance of financial instruments (Treasury Notes). It allows the Finance Ministry to issue short-term instruments to cover cash shortfalls during the fiscal year, as long as they are repaid within the same period. (Decree 4-2025, 2025)
- Resolution GE No. 1391/08-08-2011 whereby the Standards for the Strengthening of Transparency, Financial Culture and Attention to Financial Users in Supervised Institutions are approved — This resolution establishes rules requiring banks, insurance companies and other supervised financial institutions to be transparent with customers, designate an officer to handle complaints, publish clear information about products and services, resolve grievances within a maximum of 10 business days, and submit monthly reports to the National Commission of Banks and Insurance.
- Law of the National Penitentiary System — This law creates and organizes the National Penitentiary Institute (INP) to manage Honduras' prisons and penal facilities. It establishes that prisons must rehabilitate inmates while respecting their human rights through a progressive treatment system supervised by judges. It defines the structure, functions, and responsibilities of penitentiary authorities, as well as disciplinary rules and rights for people deprived of liberty. (Decree 64-2012, 2012)
- Decree Number 21-2021 by which the Executive Decree Number PCM-137-2020 is ratified in all and each of its parts — This decree ratifies all constitutional restrictions from Executive Decree PCM-137-2020 to contain the COVID-19 pandemic. It affects all Honduran citizens through temporary limitations on rights such as movement and assembly, with the purpose of preventing contagion and protecting the population's lives. (Decree 21-2021, 2020)