Regulations of the Social Contribution of the Economy Law
Poder Ejecutivo
- Decree: Acuerdo No. 567-2019
- Published: October 25, 2019
- Issuing body: Poder Ejecutivo
- Gazette: 35,081
- Category: Financial & Tax
Summary
This regulation establishes a 15% tax on net profits of cooperatives and social economy enterprises. It applies to worker organizations that share ownership of production means, excluding certain special categories. Companies must declare and pay this tax within three months after closing their fiscal year.
Considerations
Whereas Article 247 of the Constitution of the Republic establishes that the Secretaries of State are collaborators of the President of the Republic in the guidance, coordination, direction and supervision of the organs and entities of the national public administration, in their area of competence.
Whereas the Constitution of the Republic in Article 351 establishes 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 Article 1 of the Law of the Social Sector of the Economy contained in Decree Number 193-85, published in the Official Gazette La Gaceta dated January 11, 1986, declares of public interest the organization, promotion and development of the Social Sector of the Economy, to contribute to humanizing the economic and social development of the country in accordance with the principles of efficiency in production, social justice in the distribution of economic wealth in the diverse forms of property and enterprises upon which the Economic System of Honduras is based, in accordance with the Constitution of the Republic.
Whereas in accordance with Numeral 15) of Article 29 of the Public Administration Law and its Reforms, the Secretary of State in the Office of Finance is competent for all matters concerning the formulation, coordination, execution and evaluation of policies related to Public Finance, for which reason it must ensure the correct application of the legal norms related to the functioning of the Tax System of Honduras.
Whereas in accordance with Article 60 of the Regulations of Organization, Functioning and Competence of the Executive Branch contained in Executive Decree PCM-008-97 reformed by Decree PCM-35-2015, published in the Official Gazette La Gaceta on June 26, 2015, it is the responsibility of the Secretary of State in the Office of Finance through the General Directorate of Tax Policy to define, monitor and evaluate tax policy, in order to achieve a sustainable fiscal policy for the benefit of Honduran society.
Whereas in accordance with Article 9 of Decree No. 170-2016 containing the Tax Code, published in the Official Gazette La Gaceta on December 28, 2016, it establishes that the President of the Republic, through the Secretary of State in the Office of Finance (SEFIN), is empowered to issue general administrative acts called Regulations, within the scope of tax and customs policy competence and all those powers that by disposition of the Constitution of the Republic and by Law correspond to him, either directly or through the aforementioned Secretary of State.
Whereas in accordance with Article 195 Numeral 3 of the Tax Code, the mission of the Tax Administration and the Customs Administration must be oriented to optimize tax collection, through the administration, application, inspection, supervision, review, efficient and effective control, and collection enforcement of internal and customs taxes, as appropriate.
Whereas Article 36 numeral 8 of the General Law of Public Administration establishes that it is an attribution of the Secretaries of State to issue Agreements and Resolutions on matters within their competence and those delegated to them by the President of the Republic and to ensure their execution.
Whereas Article 41 of the Administrative Procedure Law establishes that it is incumbent upon the Executive Branch to issue the regulations of Public Administration, except as otherwise provided by Law.
Whereas by Executive Agreement Number 023-2018, published in the Official Gazette La Gaceta on April 20, 2018, the President of the Republic delegates to the Sub-Secretary of General Government Coordination the power to sign the administrative acts which according to the General Law of Public Administration are within the authority of the Constitutional President of the Republic.
Articles
PURPOSE.- To regulate the provisions contained in Decree No. 131-2018, containing the Law on Social Contribution of the Social Economy Sector, published in the Official Gazette La Gaceta on February 26, 2019.
SCOPE OF APPLICATION.- The norms contained in this Regulation shall apply throughout the National Territory for all Legal Entities operating under the Law of the Social Economy Sector not included in Decrees Nos. 53-2015 dated April 29, 2015 and 92-2015 dated September 8, 2015.
DEFINITIONS.- For purposes of the application of this Regulation, the following terms are defined: 1. CSSE: Social Contribution of the Social Economy Sector. 2. LAW: Law on Social Contribution of the Social Economy Sector. 3. SAR: Revenue Administration Service acting as the Tax Authority. 4. SOCIAL ECONOMY SECTOR: Set of enterprises and organizations formed by workers that uphold the primacy of labor, opt for social ownership of the means of production and establish that the surplus generated is a means to raise the standard of living of their members. 5. SEFIN: State Secretariat of Finance. TITLE II OBLIGATED SUBJECTS, TAXABLE EVENT, FORMS AND TIMING OF PAYMENT OF SOCIAL CONTRIBUTION OF THE SOCIAL ECONOMY SECTOR
OBLIGATED SUBJECTS.- All Legal Entities operating under the Law of the Social Economy Sector not included in Decrees Nos. 53-2015 dated April 29, 2015 and 92-2015 dated September 8, 2015 and that are duly registered in the unified Registry of the Institute of Property (IP), created by Decree No. 46-2016 dated April 26, 2016, published in the Official Gazette La Gaceta on April 27, 2016, are obligated to pay the Social Contribution of the Social Economy Sector (CSSE).
SOCIAL CONTRIBUTION.- FIFTEEN PERCENT (15%) of net surpluses or net profits generated in the prior fiscal period.
TAXABLE EVENT.- For these purposes, it shall be understood as the actual event that gives rise to the birth of the tax obligation, the net surpluses or net profits generated in the prior fiscal period.
TAX BASE.- Net surpluses or net profits result from the difference between total income minus expenses directly related to the generation of income and funds.
TOTAL INCOME.- Total income shall comprise all income received or accrued by Legal Entities operating under the Law of the Social Economy Sector not included in Decrees Nos. 53-2015 dated April 29, 2015 and 92-2015 dated September 8, 2015, excluding income received in the form of dividends or any other form of participation in surpluses or profits of another legal entity operating under Decrees Nos. 53-2015 and 92-2015.
EXPENSES DIRECTLY RELATED TO THE GENERATION OF INCOME.- Expenses directly related to the generation of income are those ordinary and necessary expenses that must be incurred and have a direct impact on the production of net surpluses or net profits and bear a proper proportion to the amount thereof.
FUNDS.- Funds shall only be deductible when they are directly related to:
- 1)
Capitalizations;
- 2)
Reserve for cases of losses or legal reserves;
- 3)
Housing, Education and Health;
- 4)
Social welfare and training; and, 5. Donations duly documented, in accordance with the Invoicing Regime.
SETTLEMENT AND PAYMENT OF THE CSSE.- The settlement and payment of the CSSE must be carried out no later than within three (3) months following the close of the prior fiscal period in the forms and conditions established by the Revenue Administration Service. Legal Entities operating under the Law of the Social Economy Sector not included in Decrees Nos. 53-2015 dated April 29, 2015 and 92-2015 dated September 8, 2015, that fail to comply with the payment obligation described in the preceding paragraph, shall be subject to the sanctions established in the current Tax Code. TITLE III SUPERVISION AND SANCTIONS
SUPERVISION.- It is the responsibility of the Tax Authority to control, supervise and collect the CSSE, in accordance with the Law and this Regulation.
OBLIGATIONS OF OBLIGATED SUBJECTS.- The obligated subjects expressed in Article 4 of this Regulation must comply with the following obligations: 1. Comply with the formal and material obligations derived from the performance of the function as withholding agent of any tax in accordance with the legal framework governing the tax and customs system. 2. Comply with the obligations established in the Law and this Regulation. Obligated subjects shall not be subject to the payment of Income Tax, including their installment payments, withholdings or advance payments on the income that gives rise to the net surpluses or net profits that constitute the tax base of the CSSE.
SANCTIONS.- Legal Entities operating under the Law of the Social Economy Sector not included in Decrees Nos. 53-2015 dated April 29, 2015 and 92-2015 dated September 8, 2015, that fail to comply with the obligations established in the Law and this Regulation, must be sanctioned in accordance with the Current Tax Code. TITLE IV FINAL PROVISIONS
CREDIT FOR INSTALLMENT PAYMENTS.- The installment payments of Income Tax for the 2019 fiscal period made by Legal Entities operating under the Law of the Social Economy Sector not included in Decrees Nos. 53-2015 dated April 29, 2015 and 92-2015 dated September 8, 2015, may request the refund or credit notes of the favorable balances from the 2019 period for payments to which they were not obligated. The preceding rule shall also apply to withholdings and advance payments in the matter of Income Tax.
ADDITIONAL PROVISIONS.- The Ministry of Finance in coordination with the Tax Administration, through an Executive Agreement shall regulate all matters not regulated in this Regulation.
EFFECTIVE DATE.- This Regulation shall enter into force on the day of its publication in the Official Gazette "La Gaceta". LET IT BE COMMUNICATED AND PUBLISHED, MARTHA VICENTA DOBLADO ANDARA Undersecretary of General Government Coordination by delegation of the President of the Republic Executive Agreement Number 023-2018, published in the Official Gazette "La Gaceta" on April 20, 2018 ROCÍO IZABEL TÁBORA MORALES Ministry of Finance
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