Regulations for the Law on Organization of Public Finance and Control of Tax Exemptions

Purpose.- The purpose of this Regulation is to develop the provisions contained in Decree No. 278-2013 containing the Law for the Organization of Public Finances, Control of Exemptions and Anti-Evasion Measures approved on December 21, 2013, published in the Official Gazette "La Gaceta" on December 30, 2013 and its amendments.

Scope of Application.- The norms contained in this Regulation are applicable throughout the national territory for all acts, facts and situations regulated in Decree No. 278-2013 and its amendments.

Definitions.- For purposes of the application of the Law and this Regulation, the following concepts are defined: 1. Lucrative Activity: Is the activity that supposes the combination of one or more factors of production, with the purpose of producing, transforming, commercializing, transporting or distributing goods for their sale or provision of services, on account and risk of the taxpayer, and from which profit, gain or benefit is obtained. 2. Non-Lucrative Activity: Are the activities carried out by entities whose purpose is not the achievement of economic benefit but rather mainly pursue a social, altruistic, humanitarian or community purpose, or when the income received is destined to the sustainability and operation of the organization, its programs and social investment projects. 3. Non-Profit Associations: Are those voluntary private organizations of public interest without profit motive that direct their programs or projects to the least favored sectors of the Honduran population, promoting the satisfaction of their needs, which are regulated by the Special Law for the Promotion of Non-Governmental Development Organizations, contained in Decree No. 32-2011 dated April 5, 2011 published in the Official Gazette "La Gaceta" on June 27, 2011 and its Amendments, and those governed by the Law Regulating Private Development Organizations that engage in Financial Activities contained in Decree No. 229-2000 dated November 3, 2000 published in the Official Gazette "La Gaceta" on February 3, 2001 and its amendments. 4. Affiliated Commerce: One who makes use of POS terminals. 5. Declaration of Fiscal Sacrifice: Is the Declaration made by natural and legal persons regarding the fiscal benefits granted to them by the State through Decrees, General Laws and Special Laws and that imply the partial or total release from the payment of any type of tax, tributes or levies, contributions, fees or surcharges. 6. Refund of 8% of Sales Tax: Is the refund of eight percent (8%) of Sales Tax effectively paid and itemized by the affiliated commerce or itemized in the debit or credit card transaction. 7. Customs Franchise: Is the public document that certifies the exemption from payment of Tariff Rights, fees, surcharges and taxes, corresponding to the importation of merchandise. 8. Professional Fees: Remuneration or stipend granted for the performance of work or services, to natural persons dedicated to the liberal practice of a profession, when there is no relationship of economic dependence between the parties and where the professional performs the work or service, freely sets their remuneration. 9. Indemnification: Is the payment received by a natural or legal person as compensation for expropriation, affectation or damage caused to real property by the State. 10. Law: Law for the Organization of Public Finances, Control of Exemptions and Anti-Evasion Measures and its amendments. 11. Labor Organizations: Any permanent association of workers, employers or persons of independent profession or trade, constituted exclusively for the study, improvement and protection of their respective common economic and social interests in accordance with what is established in Articles 468 and 471 of the Labor Code contained in Decree 189-59 and its amendments. 12. OTCD: Credit and Debit Card Operators. 13. OTCD Acquirer: Is a member associated with an international brand (Visa, Master Card, American Express, JCB, Diners Club, Discover and any other) and licensed to process and settle transactions made with credit and/or debit cards in affiliated commerce. 14. POS (Point of Sale Terminal): Device and technology that allows sales transactions of affiliated commerce through credit and/or debit cards. 15. Physical POS: Is a physical device located at a point of sale also physical, through which the Affiliated Commerce performs the transaction of charging for the sale made by communicating it through said means to the OTCD Acquirer. 16. Fiscal Sacrifice: Are the monetary resources that the State ceases to receive due to the fiscal benefits granted to natural and legal persons, through Decrees, General Laws and Special Laws and that imply the partial or total release from the payment of any type of tax, tributes, levies, contributions, fees or surcharges. 17. Bakery Sector or Industry: Is the economic activity carried out by natural or legal persons that have as their main business the production and/or commercialization of different types of products made from flours and other inputs directly related. 18. Construction Services: Comprises urbanization, construction and in general the making of material work of real property, for which the contractor directly or indirectly constructs, manufactures, erects, or raises works, buildings, constructions for residences or businesses, bridges, roads, dams, aqueducts and buildings in general, and the works inherent to their construction, such as: electricity, plumbing, heating, masonry, drainage and all elements that are incorporated into the construction. Likewise, reconstruction, remodeling services that imply structural changes in the original work, including studies, designs, supervision and maintenance or repair services directly related to the work are considered construction services. 19. Habitual Residence: Is the real property where a natural person has their permanent residence, inhabiting it effectively, and which constitutes the domicile for tax purposes.

Repeal of Exemptions.- For purposes of applying Article 1 of the Law, it is understood that the repealed fiscal benefits are all exemptions from local tributes and customs franchises caused by the importation of goods and merchandise, and the exemptions from local purchases of goods and services, established in the different general and special laws.

Exceptions.- For purposes of applying Article 2 of the Law, the following exemptions and customs franchise exemptions from the importation of goods and merchandise, and those granted in local purchases remain in force:

• 1)

  Those granted by mandate of the Constitution of the Republic;

• 2)

  Those granted by Treaties, International and National Conventions, including national conventions subscribed between producers of basic grains with agroindustry. 3. Those granted, according to Decree No. 185-86 of October 31, 1986, published in the Official Gazette "La Gaceta" on November 21, 1986, and its amendments, to beneficiaries residing abroad during the period from November 15 to January 15 of each year; 4. The traveler regime described in the Central American Customs Code (CAUCA) and its Regulation, related to the exemption from payment of tributes for traveler's baggage, as well as for those goods different from the traveler's baggage, whose value does not exceed what is stipulated in the legal instruments cited in this numeral; 5. Those granted in Article 10 of Decree No. 26-90-E, containing the Special Law of Letter of Naturalization; 6. Those granted according to Decree No. 37-95 to Sports Delegations, published on April 24, 1995, as long as they are for the exclusive use of the sports delegations in representation of the country, related to the payment of Airport Service Fee and Sales Tax on tickets for air transport; 7. Those granted to churches in accordance with Decrees and Special Laws, and that are recognized by the corresponding authorities; 8. Those granted to the National Coffee Fund, according to Article 8 of Decree No. 70-2001, approved on May 30, 2001, published in the Official Gazette "La Gaceta" on July 30, 2001, and its amendments; 9. Those granted to the Honduran Coffee Institute (IHCAFE), in accordance with Article 47 of Decree No. 213-2000 published in the Official Gazette "La Gaceta" on December 22, 2000, and its amendments, only in relation to the importation of fertilizers; 10. Those granted to resident rentiers and pensioners according to Articles 25 and 26 of the Migration and Foreigners Law contained in Decree 208-2003, of December 12, 2003, published on March 3, 2004, and its amendments; 11. Those granted according to Article 220 of the Electoral Law and Political Organizations, contained in Decree No. 44-2004 of April 1, 2004, published on May 15, 2004, and its amendments; 12. Those granted according to Articles 36, 54, 55 and 56 of the Law of Equity and Comprehensive Development for Persons with Disabilities contained in Decree No. 160-2005 of May 24, 2005, published on October 25, 2005; 13. Those granted according to Article 36 of the Comprehensive Law for the Protection of the Elderly and Retirees contained in Decree No. 199-2006 of January 15, 2007, published on July 21, 2007, exclusively for the importation of necessary medical supplies for geriatric and gerontological treatment performed by non-profit institutions dedicated to the assistance and care of the elderly and retirees; as well as the exemption from Sales Tax for materials and equipment used in the construction of buildings intended for the elderly, prior to the opinion of the Secretaries of State in the Departments of Health and Finance, in accordance with their competencies; 14. Those granted according to Article 37 of the Law for the Promotion and Protection of Investments contained in Decree No. 51-2011, approved on May 3, 2011 and published on July 15, 2011; 15. Those granted in Article 4 of the Law for the Promotion of Sustainable Rural Tourism, contained in Decree No. 126-2011 dated August 9, 2011, published on October 4, 2011, as follows: a. Exemption for five (5) years for the importation of goods and inputs necessary for the creation or improvement of their businesses; and, b. Exemption for three (3) years from the payment of Sales Tax for the purchase of goods and inputs necessary for the creation or improvements of their businesses. 16. Those granted according to Decrees and Existing Conventions between the Government of Honduras and the Panamerican Agricultural School El Zamorano; 17. Those granted in accordance with the Law of Population Security, Decree No. 105-2011 dated June 24, 2011, published in the Official Gazette "La Gaceta" on July 8, 2011, and its amendments, relating it to Decree 199-2011 dated November 4, 2011, published in the Official Gazette "La Gaceta" on December 3, 2011, containing the Law of Trust for the Administration of the Fund for Population Protection and Security, specifically in relation to Article 7; 18. Those granted, in the following laws:

  • a)

    Temporary Import Regime (RIT), contained in Decree No. 37-84, dated December 20, 1984, published in the Official Gazette "La Gaceta" on December 27, 1984, and its amendments;

  • b)

    Law of Incentives for Tourism (LIT), contained in Decree No. 314-98 dated December 18, 1998, published in the Official Gazette "La Gaceta" on April 23, 1999, and its amendments;

  • c)

    Law of Free Zones (ZOLI), contained in Decree No. 356 dated July 19, 1976, published in the Official Gazette "La Gaceta" on July 21, 1976 and its amendments;

  • d)

    Law for the Promotion of Electric Energy Generation with Renewable Resources contained in Decree No. 70-2007 dated May 31, 2007, published in the Official Gazette "La Gaceta" on October 2, 2007, and its amendments;

  • e)

    Energy Supply Contracts subscribed by the National Electric Company (ENEE) and that are duly approved through Legislative Decrees;

  • f)

    The right granted in Article 54 of Decree 51-2003 of April 3, 2003, published in the Official Gazette "La Gaceta" on April 10, 2003, referring to Decree No. 233-2001 of December 29, 2001 that contains the Law Constituting Agricultural Export Zones (ZADE), and, g. Acquisitions for equipment and construction of prisons in the National Penitentiary System contained in Decree No. 32-2013, published on April 2, 2013; h. Those granted according to Decree No. 212-87 dated November 29, 1987, containing the Honduran Customs Law, published in the Official Gazette "La Gaceta" on December 29, 1987, and its Amendments; i. Those Granted by the Law of Emission of Thought contained in Decree No. 6 of July 26, 1958, published in the Official Gazette "La Gaceta" on August 6, 1958, and its amendments, exclusively for the importation of machinery, spare parts, accessories, including inks and paper for newspapers, in sheets or in reels and other materials used as means to express and disseminate thought, including materials necessary for the production of filmed works, books, magazines and pamphlets, reams of letter-size, legal-size and any size paper, as well as cassettes, diskettes, compact discs and films, as long as they are not intended for commercial traffic; j. Donations to meet priority needs of health, food, education and job generation to: a. The State; and, b. Non-profit development associations. To make the exemption effective, an agreement will be required that establishes the origin of the funds, identification of the donor and donee, and the destination of the donated funds. These requirements will not be required for in-kind donations from abroad, which will be governed by the Law for the Control of Customs Franchises. 22. Donations granted to the Permanent Emergency Commission (COPECO); 23. Those granted in Decree No. 143-2013 of July 23, 2013 containing the Law of the National Fund for the Competitiveness of the Agricultural Sector published in the Official Gazette "La Gaceta" on October 4, 2013 and its Amendments, exclusively those related to the exemptions from Sales Tax in accordance with what is established in Article 15, subsection e) of the Sales Tax Law, and its Amendments; 24. Contracts subscribed by the Commission for the Promotion of Public-Private Alliance (COALIANZA) and approved by the National Congress; and, 25. Those granted to the HONDURAN RED CROSS, Decree No. 127-2001 dated August 28, 2001, published in the Official Gazette "La Gaceta" on October 25, 2001, and its amendments. The aforementioned exceptions shall be interpreted in accordance with what is provided in the Second Paragraph of Article 6 of the Tax Code. For purposes of applying the Law (Decree 278-2013), what is established in Article 8 of said Code shall apply, and the provisions enumerated in Title Five, Chapter II, Second Section of said legal body must also be applied strictly. Notwithstanding what is provided in the preceding paragraph, all those fiscal benefits granted through General and Special Laws that are not enumerated in Article 2 of the Law, are repealed as of the effective date of the same.

Call Centers and Business Services Outsourcing.- The Call Centers and Business Services Outsourcing beneficiaries of the Law for the Promotion of Call Centers and Business Services Outsourcing, Decree No. 90-2012, as of the effective date of Decree No. 278-2013, shall enjoy the total exemption from the payment of tariff taxes, charges, surcharges, consular rights, internal taxes, consumption taxes and other taxes that burden the importation of equipment, tools, spare parts, accessories, furniture and office equipment and other goods that do not have a direct relationship with the operations and execution of the incentivized activity.

Obligations of Subjects Benefiting from Exemptions.- To enjoy the exemptions, excuses and customs franchises in the importation of merchandise and the exemptions granted in local purchases, the beneficiary subjects shall act in accordance with what is provided in the Regulation that the Secretary of State in the Department of Finance issues through the General Directorate of Customs Franchise Control, according to what is provided in Article 25 of the Law. Likewise, beneficiary subjects shall have the formal obligation to present the Declaration of Fiscal Sacrifice in the form, means and time periods established by the Executive Directorate of Income. Non-compliance with this formal obligation shall be sanctioned in accordance with what is established in the Tax Code.

Reform of the Contribution for Attention to Social Programs and Conservation of Road Heritage.- The CONTRIBUTION FOR ATTENTION TO SOCIAL PROGRAMS AND CONSERVATION OF ROAD HERITAGE (ACPV), for Petroleum and its derivative products, shall be as follows: Product Contribution in Dollars Premium Gasoline 1.4089 Regular Gasoline 1.2416 Diesel 0.8606 Fuel Oil (Bunker C) 0.4267 Kerosene 0.1500 LPG: Up to 25 pounds 0.1500 Superior to 25 pounds 0.1500 AvJet 0.0300 The declaration, settlement and payment of the aforementioned Contribution must be made in accordance with what is established in the Laws and Regulations in force applicable in the matter.

Exemptions in Income Tax.- All exemptions granted in concept of Income Tax established through Decrees and Special Laws are repealed, including those established in Article 7 of the Income Tax Law and its amendments, except those granted by:

• 1)

  The Constitution of the Republic;

• 2)

  Conventions or International Treaties approved by the National Congress;

• 3)

  The Convention of the Central American Bank for Economic Integration (BCIE);

• 4)

  The Convention of the Panamerican Agricultural School;

• 5)

  The Vienna Convention to members of the Diplomatic and Consular Corps accredited in the country, only regarding income from remuneration or fees that they receive for their services from the respective country, without prejudice to the application of the principle of international reciprocity; as well as to International Organizations and Agencies, in accordance with their respective convention;

• 6)

  The Law in favor of the State, Municipalities and other decentralized and autonomous institutions except the Public Enterprises referred to in Article 53 of the General Law of Public Administration;

• 7)

  Contracts subscribed with the State, which grant the exemption and which are approved by the National Congress;

• 8)

  The Law to enterprises that operate in the Regime contained in:

  • a)

    Law of Free Zones (ZOLI), Decree No. 356 dated July 19, 1976, published in the Official Gazette "La Gaceta" on July 21, 1976 and its amendments;

  • b)

    Law of Industrial Processing Zones (ZIP) dated April 7, 1987 published in the Official Gazette "La Gaceta" on April 27, 1987;

  • c)

    The right granted in Article 54 of Decree No. 51-2003, Law of Tax Equity of April 3, 2003, published in the Official Gazette "La Gaceta" on April 10, 2003;

• 9)

  Decrees and Special Laws to Recognized Churches by the corresponding authorities;

• 10)

  The Laws to Retirees or Pensioners for the amount of the pension received;

• 11)

  The laws to the elderly, regarding the deductions granted for benefits granted, according to Article 33 of the Comprehensive Law for the Protection of the Elderly and Retirees contained in Decree No. 196-2006 dated January 15, 2007 published in the Official Gazette "La Gaceta" on July 21, 2007, referring to the deduction from gross income, for purposes of payment of Income Tax, of 50% of the amount resulting from the total sum of discounts granted by virtue of the law cited in this numeral, and others that result in other legal provisions;

• 12)

  The Law to Trade Associations, Employers Associations, Non-profit Associations and Labor Organizations, duly formalized and recognized by the State, with legal status regarding their non-profit activities; said activities must be classified by the Executive Directorate of Income (DEI). The classification issued by the Executive Directorate of Income (DEI), shall have the character of Opinion, which shall not be binding in accordance with what is established in Article 24 of the Law. This Opinion must be issued within ten (10) business days counted from the date of referral of the request by the General Directorate of Customs Franchise Control of the Secretary of State in the Department of Finance;

• 13)

  Legal provisions regarding legally constituted Political Parties;

• 14)

  The Law for the Promotion and Protection of Investments contained in Decree No. 51-2011 published on June 15, 2011, Article 37, to beneficiaries sheltered there;

• 15)

  Decree No. 70-2007 dated May 31, 2007 published in the Official Gazette "La Gaceta" on October 2, 2007, containing the Law for the Promotion of Electric Energy Generation with Renewable Resources, and its amendments, in the sense of:

  • a)

    Grant the exemption from Income Tax for ten (10) years, equivalent to one hundred twenty (120) months, counted from the date of commencement of commercial operation of the renewable energy generation project, established through the Certification of Commencement of Commercial Operation issued by the National Electric Company (ENEE), or the Certification issued by the National Energy Commission, in the absence thereof. In case of projects constructed by stages within the same ten (10) year period and at the request of the project developer, this exemption includes income generated by the power and its associated energy delivered during the construction period of the renewable energy plant;

  • b)

    Exempt from Income Tax and its withholdings on payments for services or fees contracted with natural or legal persons abroad, necessary for studies, development, design, engineering, construction, installation, administration and monitoring of the renewable energy project. This exemption shall also include, in addition to the aforementioned services, all types of financial services and/or investment provided for the construction and operation of energy generation projects with renewable resources, provided by foreign investment or financial institutions or with headquarters outside the national territory, as long as it is: i. Bilateral Organizations; ii. Multilateral Organizations with some development approach, or, iii. Foreign legal persons that engage in financing, among others, electric energy generation projects with renewable sources and whose funds and/or assets come from or are integrated partially or entirely by Bilateral and Multilateral Organizations with some development approach. 16. The Patuca III Hydroelectric Project contract approved by the National Congress; and, 17. Decree No. 90-2012 of June 14, 2012 containing the Law for the Promotion of Call Centers and Business Services Outsourcing, published on July 18, 2012, in article 5 numeral 2, exclusively for income from the incentivized activity during the period in which they carry out their operations in the free zone, counted from the start of operations; In the Fast Food and Beverages Sector, legal persons and other companies benefited by the Law of Incentives for Tourism and its amendments that have an incorporation resolution to the Regime, shall continue to enjoy Income Tax exemption until its expiration, according to the time period established in said Law. To enjoy Income Tax exemptions, it will be necessary for the beneficiary to comply with the procedure contained in the Regulation that the Secretary of State in the Department of Finance issues through the General Directorate of Customs Franchise Control, according to what is provided in Article 25 of the Law. Likewise, beneficiary subjects must present the Declaration of Fiscal Sacrifice in the form, means and time periods established by the Executive Directorate of Income. Non-compliance with this obligation shall be sanctioned in accordance with what is established in the Tax Code. The aforementioned exceptions shall be interpreted in accordance with what is provided in the Second Paragraph of Article 6 of the Tax Code. For purposes of applying the Law (Decree 278-2013), what is established in Article 8 of said Code shall apply, and the provisions enumerated in Title Five Chapter II Second Section of said legal body must also be applied strictly. Notwithstanding what is provided in the preceding paragraph, all those fiscal benefits granted through General and Special Laws that are not enumerated in Article 5 of the Law, are repealed as of the effective date of the same.

Withholding of Capital Gains Tax.- The State establishes the Withholding, settlement and payment of Capital Gains Tax established in Article 10 of the Income Tax Law, amended through Article 6 of the Law, considering the following: 1. Withholding Rate: 10% shall be applied each time the taxpayer or liable party obtains Capital Gains, for payments made by the State for the concepts established in Article 6 of the Law; even if the payment is made to a non-domiciled or non-resident party. 2. Taxable Fact: For these purposes, the real act that gives rise to the birth of the tax obligation shall be understood, Capital Gains obtained by taxpayers or liable parties for payments made by the State, derived from the purchase-sale of assets, indemnifications, purchase of rights and securities. 3. Tax Base: To determine the calculation of the taxable base, ordinary and necessary expenses to produce the Capital Gain shall be considered, in accordance with the Income Tax Law and its amendments. For purposes of calculating Capital Gain derived from the purchase-sale of real property, the Property Institute or the National Agrarian Institute, as appropriate, must provide and certify the information on the registered values thereof, so that the Executive Directorate of Income (DEI), without prejudice to what is established in the preceding paragraph, determines the amount of Capital Gains Tax and communicates it to the State entity that will make the withholding. For purposes of applying subsections "c)") and "e)") aforementioned, prior to the registration of the real property, the taxpayer or liable party must prove through a sworn statement, duly authenticated, that the real property affected is their habitual residence; said Declaration shall be subject to subsequent verification by the Executive Directorate of Income (DEI).

Settlement and Payment of Capital Gains Tax Withholding.- The withholding agent shall present the settlement of the Capital Gains Tax withholding in the respective declaration, in accordance with what is established in Article 14 of the Law of Efficiency in Income and Public Spending and its Amendments; the payment of the tax must be made by the withholding institution within ten (10) business days following, counted from the moment the withholding was made, issuing the respective receipts for purposes of control and inspection by the Executive Directorate of Income (DEI). In the case of purchase-sale of real property, the Property Institute shall not proceed to make its registration without the payment of Capital Gains Tax having been proven. Notwithstanding the foregoing, the passive subject of the tax obligation shall be obliged to present its annual capital gain declaration in accordance with the laws in force.

Air, Land and Maritime Transport Companies.- The calculation of Income Tax in the case of air, land and maritime transport companies established in Article 8 of the Law, shall be made in accordance with the following: 1. Tax Rate: Three percent (3%) of the total annual gross income from Honduran source, when the application of the rates indicated in subsections "a)") and "b)") of Article 22 of the Income Tax Law and its amendments, result in less than three percent (3%) of the declared gross income. Consequently, air, land and maritime transport companies shall not be subject to what is established in Article 22-A of the Income Tax Law and its amendments; however, they remain subject to the provisions applicable to Solidarity Contribution. 2. Tax Base: It consists of the total sum of gross income obtained in the fiscal year by air, land and maritime transport companies constituted abroad and authorized to operate in the country. 3. Taxable Fact: Shall be understood as the real act that gives rise to the birth of the tax obligation, consisting of obtaining in the fiscal year gross income from Honduran source derived from the sale of tickets and/or passages, as well as, the provision of services.

Article 22-A of the Income Tax Law.- The application of Article 22-A to the Income Tax Law and its amendments, established in Article 9 of the Law, shall be made in accordance with the following: 1. Tax Rate and taxable base of the tax: a) One point five percent (1.5%) on gross income equal to or greater than TEN MILLION LEMPIRAS (L10,000,000.00) of the tax period. b) Zero point seventy-five percent (0.75%) on gross income equal to or greater than TEN MILLION LEMPIRAS (L10,000,000.00) of the tax period, as long as natural or legal persons produce or commercialize the following products and services: i. Production, distribution and commercialization of Cement; ii. Public services provided by state companies; iii. Medicines and pharmaceutical products for human use, at the producer, importer or retailer level; and, iv. The bakery sector or industry. Gross income shall be understood for purposes of this numeral as total income minus discounts, rebates and returns. 2. Taxable Fact: For these purposes, the real act that gives rise to the birth of the tax obligation shall be understood, the obtaining in the fiscal year of gross income equal to or greater than ten million lempiras (L10,000,000.00) provided that the application of the percentages indicated in subsections "a)") and "b)") of Article 22 of the Income Tax Law result in less than one point five percent (1.5%) or zero point seventy-five percent (0.75%), as appropriate, calculated on the gross income generated. 3. Passive Subjects: Natural or legal persons domiciled or resident in Honduras. 4. Settlement and Payment of the Tax: Natural or legal persons domiciled in Honduras shall settle and pay the tax in accordance with the Income Tax Law and its amendments. The tax resulting from the application of one point five percent (1.5%) or zero point seventy-five percent (0.75%), shall be the basis for determining Installment Payment Quotas as of the 2014 fiscal period. Natural or legal persons that demonstrate to the Executive Directorate of Income (DEI), through a Fiscal Audit report prepared by an External Audit Firm, different from the one that audits their Financial Statements, duly registered with the National Banking and Insurance Commission (CNBS), that their economic situation has experienced negative financial changes beyond their control, which affect the calculation of their installment payment quotas in the current tax period and their fourth quota to settle in their Income Tax declaration and that have paid their installment payments as of the date of presentation; shall not be subject to the payment of one point five percent (1.5%) and zero point seventy-five percent (0.75%) as appropriate, and shall be subject to the application of subsections a) and b) of Article 22 of the Income Tax Law and its amendments, with the Executive Directorate of Income (DEI) issuing the respective Resolution. Those taxpayers who find themselves in the situation described in the preceding paragraph must present their petition to the Executive Directorate of Income (DEI) no later than April 30 of each year or the last day in which the presentation of their Income Tax Declaration expires. In the case of the existence of a tax credit, due to the application of Article 22-A of the Income Tax Law and its amendments, the taxpayer may request the application of said credit to the payment of any tax administered by the Executive Directorate of Income (DEI). 5. Exceptions: The following natural or legal persons shall not be subject to the payment of one point five percent (1.5%) and zero point seventy-five percent (0.75%) aforementioned:

• a)

  Natural persons who obtain income from salaries and wages;

• b)

  Taxpayers whose annual gross income is less than TEN MILLION LEMPIRAS (L10,000,000.00), who nevertheless in their case must comply with the declaration and payment established in Article 22 of the Income Tax Law and its amendments and Net Asset Tax created by the Tax Equity Law, Decree No. 51-2003, of April 3, 2003 and its amendments;

• c)

  Companies during the first two (2) years of their constitution or in preoperative period, that is, until when they begin their first sales transaction in commerce;

• d)

  Natural or legal persons who incur losses, by fortuitous event or force majeure, derived from natural disasters, catastrophes, wars, state of siege, duly accredited before the Executive Directorate of Income (DEI), up to (2) fiscal years from when they occur. That loss must be certified by an audit firm duly registered with the respective Professional College, remaining subject to subsequent inspection; and,

• e)

  Natural or legal persons who obtain income from production, sale and distribution of petroleum and its derivatives. Notwithstanding the foregoing, natural and legal persons must pay taxes in accordance with what is established in Article 22 of the Income Tax Law and its amendments. Companies with income equal to or greater than One Hundred Million Lempiras (L 100,000,000.00) that declare operating losses in two alternate or consecutive periods shall be subject to what is established in Decree No. 96-2012 of June 20, 2012 published in the Official Gazette "La Gaceta" on July 20, 2012.

Income in Concept of Dividends or Any Other Form of Profit Sharing.- The determination, withholding, settlement and payment of Income Tax on Dividends or any other form of profit sharing established in Article 10 of the Law; must be made in accordance with the following: 1. Tax Rate: Eleven percent (11.0%) on the amount paid or credited in concept of dividends or any other form of profit sharing. 2. Taxable Fact: For these purposes it shall be understood as the real act that gives rise to the birth of the tax obligation, the receipt of dividends or any other form of profit sharing that have been agreed by the competent body of the corporation or entity, whether declared, paid or unpaid, credited or not credited or available to the partner. 3. Tax Base: Income received in concept of dividends or any other form of profit sharing from reserves, in cash or in kind, of any type of entity, whether or not it has legal status. Likewise, dividends distributed by corporations covered by special regimes are taxed. In particular, the concept of profit sharing includes: a. Accounts receivable from partners or related companies that do not arise from a commercial transaction and that have a period of more than one hundred (100) calendar days. It shall be understood as a commercial transaction one that is regulated by the provisions of the Commercial Code in force and the applicable commercial practices. Commercial transactions carried out by corporations whose main purpose is to make merchant loans are included as commercial transactions. b. Capital reductions with distribution of contributions; in the part that corresponds to capitalizations of reserves or profits. For these purposes, it will be considered that the first amounts distributed correspond to this concept, until the amount of capitalized reserves or profits is exhausted. Income received in concept of dividends or any other form of profit sharing from reserves shall be taxed as a single and final withholding, by merchant corporations and shall not form part of the taxable base of natural and legal persons, subject to the rate of Article 22 or 22-A of the Income Tax Law. 4. Passive Subjects: Natural and legal persons resident or domiciled in Honduras. 5. Withholding Agents: Merchant Corporations resident or domiciled in the country. 6. Settlement and Payment of Withholding: The settlement and payment of the tax must be made no later than within the period of ten (10) calendar days of the following month in which the withholding was made, in the forms and conditions established by the Executive Directorate of Income. Non-withholding and settlement of the aforementioned tax will result in the merchant corporation the application of the sanctions established in the Tax Code. 7. Non-Subjection: Capitalization of reserves or profits including capitalization of shares remain non-subject to any type of tax. To this end, when the Supreme Body of the Corporation decides and approves the capitalization of reserves or profits, this must be duly recorded in the Minutes Book thereof.

Withholding at Source on Payments Made by the State.- The determination, settlement and payment of Withholding at Source on Income Tax that the State must make, established in Article 12 of the Law, must be made in accordance with the following: 1. Withholding Rate: Twelve point five percent (12.5%) shall be applied each time payments are made for concept of servitude, right of way and similar. 2. Taxable Fact: For these purposes it shall be understood as the real act that gives rise to the birth of the tax obligation, consisting of the receipt of payments, in concept of servitude, right of way and similar. 3. Tax Base: Shall be composed of Gross Income received in concept of servitude, rights of way and similar. Payments in concept of servitude and right of way shall be understood as charges with economic and real value that the State must pay for the use of a real property or property of a third party, either a natural or legal person, which benefits the State by providing utility in the activities it performs. For purposes of applying this provision, what is established in the Civil Code shall apply. 4. Passive Subjects: Natural and legal persons resident or domiciled in Honduras. 5. Withholding Agent: Secretaries of State, Decentralized Institutions, Decentralized Institutions including Autonomous Institutions and Municipalities, and Public Enterprises. 6. Settlement and payment of Withholding: The settlement and payment of the tax must be made no later than within the period of ten (10) calendar days of the following month in which the withholding was made, in the forms and conditions established by the Executive Directorate of Income (DEI). Natural or legal persons who fail to comply with the obligation to pay this tax within the legal time period established shall be subject to what is indicated in Article 120 of the Tax Code and other sanctions established in special laws applicable in the matter. This withholding shall be subject to the same provisions established by the Income Tax Law and its amendments.

Retention at Source on Payments Made to Non-Resident Persons.- The determination, settlement, and payment of Retention at Source on Payments Made to Non-Resident Persons, established in Article 13 of the Law, shall be carried out in accordance with the following: 1. Tax Rate: 14% on the value of the transfer of ownership (transaction value). 2. Taxable Event: For these purposes, the actual act that gives rise to the birth of the tax obligation shall be understood as the alienation of assets or rights and securities that are carried out by a natural or legal person not resident or not domiciled in Honduras. 3. Taxable Base: It shall be calculated on the value of the alienation of assets or rights and securities without any deductions. 4. Passive Subjects: Natural and legal persons not resident and not domiciled in Honduras. 5. Withholding Agent: The natural and legal persons acquiring assets or rights and securities that have been alienated by natural and legal persons not resident or not domiciled in Honduras. 6. Settlement and Payment of Withholding: The settlement and payment of the tax must be carried out no later than within the term of ten (10) calendar days of the following month in which the withholding was made, in the forms and conditions established by the Executive Directorate of Income (DEI). Natural or legal persons who do not comply with the obligation to withhold and remit this tax within the legal term established shall be subject to what is provided in Article 120 of the Tax Code and other sanctions established in applicable special laws in the matter. This withholding shall be subject to the same provisions established by the Income Tax Law and its reforms.

Fines, Surcharges and Interest.- In case of application of fines, surcharges and interest derived from audits applied to taxpayers responsible or withholding agents by the Executive Directorate of Income (DEI), it shall be applied in accordance with what is established in the Tax Code. CHAPTER V OF THE SOLIDARITY CONTRIBUTION

Solidarity Contribution.- The determination, settlement, and payment of the Solidarity Contribution, established in Article 15 of the Law, shall be carried out in accordance with the following: 1. Tax Rate: 5% shall be applied. 2. Taxable Event: For these purposes, the actual or supposed act that gives rise to the birth of the tax obligation shall be understood as the perception of a net taxable income within the fiscal period that exceeds One Million Lempiras (L 1,000,000.00). 3. Taxable Base: The excess of net taxable income exceeding One Million Lempiras (L 1,000,000.00). CHAPTER VI OF THE SALES TAX

Sales Tax Rate.- As of the effective date of the Law, the rate of the Sales Tax shall be as follows: No. Description Rate 1. Sale of goods and provision of services in general 15% 2. Telephone Services and other Telecommunications Services 15% 3. Import, national production or sale of beer, aguardiente, compound liquor and other alcoholic beverages, cigarettes and other products made from tobacco 18% 4. The sale of tickets for national and international air transport, including those issued by Internet or other electronic means, originating in Honduras, provided that they provide a right to a privileged seat (business class) 18%

Exempt Services.- In accordance with what is established in Article 15, Paragraph d) of the Sales Tax Law and its reforms and interpretations, the following services are exempt from the Sales Tax: 1. Electrical energy, except: a) Residential subscribers who have a monthly electrical energy consumption greater than seven hundred fifty (750 kWh) per month, for the provision of public or private service; and, 2. Potable water and sewerage. 3. Construction services; 4. Professional fees obtained by natural persons. 5. Education. 6. Hospitalization and ambulance transportation; 7. Clinical and human clinical analysis laboratories; 8. Radiological services and other medical services, diagnostic and surgical; 9. Service of transportation of petroleum derivatives; 10. Land transportation service of passengers; 11. Banking and financial services; and, 12. Those related to insurance premiums for persons and reinsurance in general. When the sale or services of prepared food includes products that are expressly detailed in the "List of Essential Articles of Popular Consumption", approved by Article 1 of Decree No. 4-2014, such tax shall not be charged. The following services are excluded from the exemption of the Sales Tax: 1. Aesthetic beauty treatment services, such as: spa, laser liposuction and similar services. 2. The lease of movable property with option to purchase; and, 3. The sale or service of prepared food for consumption inside or outside the establishment.

Simplified Regime.- Natural or legal persons who have only one commercial establishment and whose taxable sales do not exceed two hundred fifty thousand Lempiras exact (L.250,000.00) annually covered by the Simplified Regime described in Article 11-A of the Sales Tax Law and its reforms, shall not be responsible for the collection of the Sales Tax, being obligated only to submit an Annual Declaration of Sales Tax no later than January 31 of the following fiscal period, in the forms established by the Executive Directorate of Income. Natural or legal persons who do not comply with the obligation to submit the Annual Sales Declaration within the legal term established shall be subject to the sanctions established in the Tax Code. The submission of the Annual Declaration of Sales Tax of the Simplified Regime shall be applicable as of Fiscal Period 2014. Natural or legal persons who are in or join the Simplified Regime shall have to communicate in writing to the Executive Directorate of Income any change or tax situation within the term established in the Tax Code.

Suspension of the Sales Tax Refund.- Leave suspended for the maximum period of six (6) months as of January 1, 2014, the date on which the Law became effective, the application of Article 3 of the Law of Efficiency in Income and Public Expenditure contained in Decree No 113-2011 dated June 24, 2011, containing the refund of eight percent (8%) of the Sales Tax from purchases with Debit or Credit Cards effectively paid, with the objective that the Credit Card Service Operators and Concessionaires (OTCD) adjust their systems to make enforceable in each transaction carried out by Affiliated Businesses the following information: Consequently, as of the effective date of Decree No. 278-2013, the import or local purchases of all equipment, tools, spare parts, accessories, furniture and office equipment and other assets that do not have a direct relationship with the operations and execution of the incentivized activity are taxed with applicable taxes.

Obligations of the Beneficiary Subjects of the Exemptions.- In order to enjoy the exemptions, exemptions and customs franchises in the importation of merchandise and the exemptions granted in local purchases, the beneficiary subjects shall act in accordance with what is provided in the Regulation that for this purpose is issued by the Ministry of State in the Treasury Office, through the General Directorate of Control of Customs Franchises, as provided in Article 25 of the Law. Likewise, the beneficiary subjects shall have as a formal obligation to submit the Declaration of Fiscal Sacrifice in the manner, means and terms established by the Executive Directorate of Income. Non-compliance with this formal obligation shall be sanctioned in accordance with what is established in the Tax Code. that it receives from the respective country, without prejudice to the application of the principle of international reciprocity; as well as to International Organizations and Agencies, in accordance with their respective agreement; 6. The Law in favor of the State, the Municipalities and other decentralized and autonomous institutions except the Public Enterprises referred to in Article 53 of the General Law of Public Administration; 7. Contracts executed with the State that grant the exemption and that are approved by the National Congress; 8. The Law to companies that operate in the Regime contained in:

• a)

  Free Trade Zone Law (ZOLI), Decree No. 356 dated July 19, 1976, published in the Official Gazette "La Gaceta" on July 21, 1976 and its reforms;

• b)

  Law of Industrial Processing Zones (ZIP) dated April 7, 1987 published in the Official Gazette "La Gaceta" on April 27, 1987;

• c)

  The right granted in Article 54 of Decree No. 51-2003, Law of Itinerant Equity dated April 3, 2003, published in the Official Gazette "La Gaceta" on April 10, 2003; 9. Special Decrees and Laws for Churches recognized by the corresponding authorities; 10. Laws for Retirees or Pensioners for the amount of the pension received; 11. Laws for the elderly, regarding the deductions granted for benefits granted, according to Article 33 of the Comprehensive Law for Protection of the Elderly and Retirees contained in Decree No. 196-2006 dated January 15, 2007 published in the Official Gazette "La Gaceta" on July 21, 2007, regarding the deduction from gross income, for purposes of paying Income Tax, of 50% of the amount resulting from the total sum of discounts granted by virtue of the law cited in this numeral, and others that result in other legal provisions; 12. The Law for Trade Associations, Employer Associations, non-profit Associations and Labor Organizations, properly legalized and recognized by the State, with legal personality regarding their non-profit activities; such activities must be qualified by the Executive Directorate of Income (DEI). The qualification issued by the Executive Directorate of Income (DEI) shall have the character of an Opinion, which shall not be binding in accordance with what is established in Article 24 of the Law. This Opinion must be issued within the term of ten (10) business days counted from the date of referral of the request by the General Directorate of Control of Customs Franchises of the Ministry of State in the Treasury Office; 13. Legal provisions regarding Legally Constituted Political Parties; 14. The Law for the Promotion and Protection of Investments contained in Decree No. 51-2011 published on June 15, 2011, Article 37, to the beneficiaries covered there; 15. Decree No. 70-2007 dated May 31, 2007 published in the Official Gazette "La Gaceta" on October 2, 2007, containing the Law for Promotion of Electric Energy Generation with Renewable Resources, and its reforms, in the sense of:

  • a)

    Grant the exemption from Income Tax for ten (10) years, equivalent to one hundred twenty (120) months, counted from the date of start of commercial operation of the renewable energy generation project, established through the Certification of Start of Commercial Operation issued by the National Electric Company (ENEE), or the Certification issued by the National Energy Commission, in its absence. In case of projects that are built in stages within the same period of ten (10) years and at the request of the project developer, this exemption includes the income originated by the power and its associated energy delivered during the construction period of the renewable energy plant;

  • b)

    Exempt from Income Tax and its withholdings on payments for services or fees contracted with foreign natural or legal persons, necessary for studies, development, design, engineering, construction, installation, administration and monitoring of the renewable energy project. This exemption shall also include all classes of financial services and/or investment provided for the construction and operation of renewable energy generation projects, provided by foreign investment or financial institutions or with headquarters outside the national territory, provided that it is: i. Bilateral Organizations; ii. Multilateral Organizations with some development focus, or, iii. Foreign legal persons dedicated to financing, among others, projects for generating electrical energy with renewable sources whose funds and/or assets come from or are integrated partially or totally by Bilateral and Multilateral Organizations with some development focus. 16. The contract of the Patuca III Hydroelectric Project approved by the National Congress; and, 17. Decree No. 90-2012 of June 14, 2012 containing the Law for Promotion of Call Centers and Outsourcing of Business Services, published on July 18, 2012, in Article 5 numeral 2, exclusively for income from the incentivized activity during the period in which they carry out their operations in the free zone, counted from the start of operations; In the Fast Food and Beverage Sector, legal persons and other companies benefited by the Law of Incentives for Tourism and its reforms that have a resolution of incorporation into the Regime, shall continue to enjoy exemption from Income Tax until its expiration, according to the term established in that Law. To enjoy the exemptions of Income Tax, it shall be necessary for the beneficiary to comply with the procedure contained in the Regulation that for this purpose is issued by the Ministry of State in the Treasury Office, through the General Directorate of Control of Customs Franchises, as provided in Article 25 of the Law. Likewise, the beneficiary subjects must submit the Declaration of Fiscal Sacrifice in the manner, means and terms established by the Executive Directorate of Income. Non-compliance with this obligation shall be sanctioned in accordance with what is established in the Tax Code. The exceptions mentioned above shall be interpreted in accordance with what is provided in the Second Paragraph of Article 6 of the Tax Code. For purposes of applying the Law (Decree 278-2013), what is established in Article 8 of the aforementioned Code shall be observed, and furthermore, the Provisions set forth in Title Fifth Chapter II Second Section of that legal body must be applied strictly. Without prejudice to what is provided in the preceding paragraph, all those tax benefits granted through General and Special Laws that are not enumerated in Article 5 of the Law are repealed as of the effective date of the same.

Withholding of Sales Tax from Issuers or Operators and Concessionaires of Credit Card Service (OTCD).- In the Withholding of Sales Tax, affiliated businesses or establishments must register the value accrued for Sales Tax. If within the stated term the purpose is not fulfilled, the penalty established in Article 179 of the Tax Code shall be imposed. For the refund of eight percent (8%) of the Sales Tax, work must be done on the OTCD Acquirer modality, in which the refund shall be serialized in the physical POS, when the affiliated business makes the sale collection with credit or debit card. The beneficiaries of the refund of eight percent (8%) of the Sales Tax shall be natural cardholders who acquire goods and services through debit and credit cards. In the OTCD Acquirer modality, the affiliated business must discriminate or break down in the physical POS the amount of Sales Tax at the moment of charging their sales with credit or debit card, against that amount the "OTCD Acquirer" shall apply 8% to determine the amount to refund to the cardholder, said value shall be subtracted from the total amount of the transaction. The refunded amount must be reflected in the sales receipt issued by the physical POS. Excluded from this benefit are purchases made over the internet, purchases made manually, as well as loyalty programs (purchases with points, miles and similar), the latter without prejudice to the transaction discriminating or breaking down the corresponding Sales Tax payment. Any claim or inquiry from both affiliated businesses and cardholders must be directed to the DEI. The OTCD Acquirer shall not be responsible for the non-granting of the 8% refund as a consequence of the lack of discrimination or breakdown of ISV by the Affiliated Business. The violating affiliated business shall be sanctioned for formal tax violation in accordance with what is established in Article 180 of the Tax Code. For purposes of automatic compensation and Declaration of Sales Tax Withholdings, the "OTCD Acquirer" shall debit the amount of refunds of 8% of Sales Tax for the month against the withholdings made to Affiliated Businesses in the same month. The Executive Directorate of Income (DEI) shall be responsible for creating the mechanisms, reports or systems so that the "OTCD Acquirer" can make the Declaration of Sales Tax Withholdings as well as the refund of 8% of this tax, for which it must inform and train the "OTCD Acquirer" in the use of the declaration mechanism. The refund to cardholders of 8% of Sales Tax shall be charged at the moment the 50% withheld by the OTCD is declared.

Regulation of Exemptions.- Any exemption or tax benefit shall be granted in accordance with the Tax Code and the Special Law that establishes them, being limited only to the goods, materials, equipment, inputs and others directly related to the activity developed by the beneficiary.

Term of Benefit.- The determination of the term of the benefits granted through Legislative Decrees, General Laws and Special Laws, when these do not contemplate a term of duration of the same, must be made in accordance with the following: No. Beneficiaries Term 1. Prior to the effective date of Decree No. 278-2013. 12 years as of the effective date of Decree No. 278-2013. 2. After the effective date of Decree No. 278-2013, once accepted into the Regime, 12 years from the date of acceptance into the fiscal Regime or Law. 3. That are enjoying fiscal benefits with a determined term. Resulting differential up to reaching 12 years. Said differential shall be calculated by deducting from the 12-year term stated in Article 23 of the Law, the years enjoyed in the previous fiscal regime or Law. Excepted from this provision are the fiscal benefits established in the Constitution of the Republic, Bilateral and Multilateral International Agreements and Treaties, as well as national agreements.

Presentation of Exemption Request.- The beneficiaries of any exemption from taxes and customs franchises must register with the General Directorate of Control of Customs Franchises dependent on the Ministry of State in the Treasury Office. For the implementation of the Registry of Beneficiaries, the Executive Directorate of Income (DEI) shall provide to the General Directorate of Control of Customs Franchises the Registry that is in its files, within the term of one (1) calendar month from the publication of this Regulation.

Scheduling and Detail.- To make effective the benefits in relation to local purchases or importation of goods and merchandise, they must submit a detailed and scheduled request of the goods to be imported or acquired locally for the term of one (1) fiscal year or special fiscal period, the No. Beneficiaries Term 1. Prior to the effective date of Decree No. 278-2013. 12 years as of the effective date of Decree No. 278-2013. 2. After the effective date of Decree No. 278-2013, once accepted into the Regime, 12 years from the date of acceptance into the fiscal Regime or Law. 3. That are enjoying fiscal benefits with a determined term. Resulting differential up to reaching 12 years. Said differential shall be calculated by deducting from the 12-year term stated in Article 23 of the Law, the years enjoyed in the previous fiscal regime or Law. Excepted from this provision are the fiscal benefits established in the Constitution of the Republic, Bilateral and Multilateral International Agreements and Treaties, as well as national agreements.

Control and Rationalization of Exemptions.- Regarding the control and rationalization of the exemption to determine the procedure in granting the quantities and type of goods to make effective the benefit, the Ministry of State in the Treasury Office through the General Directorate of Control of Customs Franchises, must issue a Regulation that allows modifications in the detailed and scheduled request of goods to import or acquire locally, taking into consideration market behavior. For the preparation of the Regulation, a term of thirty (30) business days is established, from the effective date of the Law.

Restriction of Beneficiaries.- Natural or legal persons who have enjoyed fiscal exemptions or customs dispensations for having accepted a special regime may not accept another Regime at the end of the period of time for which the State granted them such benefits. When natural or legal persons are enjoying a tax benefit and have not concluded its term, and they accept a new fiscal regime, the term of the benefit in the new regime shall be determined by deducting from the term established in this one the years enjoyed in the previous regime, in such a way that in no case shall it exceed the 12 years mentioned before. TITLE III OF OTHER MEASURES OF RATIONALIZATION AND CONTROL OF PUBLIC EXPENDITURE

Incorporation of External Resources into the Budget.- The incorporation of external funds from loans into the General Budget of Income and Expenditures of the Republic shall be authorized by the Public Credit Commission, which is composed of the Secretary of State in the Office of Finance, who shall preside over it, or his/her delegate, the President of the Central Bank of Honduras and the President of the National Commission of Banks and Insurance (CNBS), and others that the Commission deems pertinent.

Payment of Final Judgments and Collateral.- When the State or its entities are condemned to recognize liquid amounts through final judgments, the calculation of commercial and default interest established in Article 100 of the Law on the Jurisdiction of Administrative Contention shall be made in accordance with the passive rate, applying the weighted average rates of savings deposits and deposit certificates of the national banking system, in effect at the time of the issuance of the final judgment. With respect to the calculation of default interest, an annual rate of two percent (2%) shall be applied. All payments derived from final judgments issued by the competent Courts of Justice shall be notified to the Superior Court of Accounts so that it may determine whether there exists responsibility of public officials for negligence or omission in the principles of legality, transparency, effectiveness and efficiency that must be observed in Public Administration.

Authorization to the Secretary of State in the Office of Finance.- The Secretary of State in the Office of Finance shall make budgetary incorporations for the amount necessary to cover losses that could be incurred during the first year from the operations of purchase of Securities that are conducted by the Central Bank of Honduras to the Retirement and Pension Institutions in the secondary market, through transfer to the respective retirement and pension institutions. For the purpose of application of this article, the purchase of securities shall be understood as the purchase and repurchase of the same in the secondary market. TITLE IV FINAL PROVISIONS

Repeals.- The following regulatory provisions are hereby repealed:

• a)

  Articles 1 through 6, Section I of Chapter I of Agreement No. 1121-2010 dated July 28, 2010.

• b)

  Articles 18 and 36, Chapter V of Agreement Number 0948-2003 dated May 27, 2003, containing the Temporary Solidarity Contribution of the Regulation of the Tax Equity Law;

• c)

  Article 32, Subsection a) of Agreement Number 0948-2003 dated May 27, 2003 containing the basic basket goods.

• d)

  Any norm that is contrary to 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 JUAN ORLANDO HERNÁNDEZ ALVARADO Constitutional President of the Republic WILFREDO CERRATO RODRÍGUEZ Secretary of State in the Office of Finance Legislative Branch DECREE No. 51-2014 THE NATIONAL CONGRESS, WHEREAS: In accordance with the Constitution of the Republic and international treaties, the human person is the supreme purpose of society and the State, for which reason the State must seek mechanisms for full development in a peaceful and orderly social group, based on respect for legal norms and the rights of others. In this sense, the Government of Honduras has carried out a series of important efforts in the fight against organized crime, a phenomenon that undermines social order and also prevents the full development of the State in all aspects that it encompasses. WHEREAS: That the various efforts to combat ORGANIZED CRIME, DRUG TRAFFICKING AND MONEY LAUNDERING should not only be directed at achieving the deprivation of liberty of the authors or participants in criminal acts, but also new legal instruments have been developed with the purpose of identifying, locating and recovering assets illicitly acquired, through the figure of seizure or forfeiture of goods, an accessory penalty or judicial sanction that seeks to discourage criminal activity through a real or patrimonial penalty that may be applied regardless of criminal responsibility for the unlawful act, in addition to striking the financial structure of criminal organizations so that they cannot continue financing their illegal activities and others related to them.