On April 14, Werner Ovalle will assume as the new head of the Superintendence of Tax Administration (SAT), a position that entails a series of key challenges to comply with the collection of taxes and provide the public administration with the necessary resources for its operation.
The SAT directory unanimously chose Ovalle to serve as the head of the tax collection entity during the 2025-2030 period. Ovalle will replace Marco Livio Díaz.
As Superintendent of Tax Administration, Ovalle must comply with the tax collection goal, which by 2025 has set at Q108 billion.
In addition to achieving that goal, expert analysts in tax issues consider that Ovalle must evaluate the effects of a new law that, in his opinion, could harm the collection.
This is Decree 31-2024, issued by Congress last year: the Law for the Integration of the Primary and Agricultural Productive Sector, promoted by Deputy Luis Aguirre, of the Cabal Block.
Livestock Ley
For Ricardo Barrientos, researcher at the Central American Institute for Fiscal Studies (ICEFI), the new law could negatively affect the collection, since it establishes a special regime for the livestock sector that could reduce tax revenues.
“It has to be very transparent in publishing and discussing the data that demonstrates a real benefit to the Treasury. We have warned that there is the possibility of mass migrations to this special regime, which would make the law end up generating tax losses, not profits,” said Barrientos.
According to the analyst, the validation of the law should be one of the first tasks that Ovalle assumes from the SAT Headquarters, since the strategies that could be covered under this law would significantly affect the collection.
“That the law be evaluated, and if it is evident that it has negative impacts, the superintendent Ovalle should have the courage to inform the board and make it public,” he added.
Erick Coyoy, an independent analyst and university professor also, considers it necessary to measure the real impacts and the possible repercussions of this law. “The great challenge is to implement that special law for the agricultural sector, because they are important changes. In normal conditions they would have to pay under the general regime, but now they will be benefited from a special regime,” he said.
Operation and projection
The operation of the SAT will be crucial to provide financial resources to the Government of Bernardo Arévalo, allowing him to fulfill his campaign promises.
At the discretion of experts, it is vital that there is a full functioning of the board of the SAT, being the superintendent a key piece and operational actor.
“That the directory exactly assumes its role. The Superintendent must propose a work plan, control strategies, and the directory must evaluate them,” said Barrientos.
It will also be vital to establish realistic collection goals to avoid distortions in estimates. “During the last four years the collection goals were underestimated. Initially, they set very low. This superintendent should face real goals,” he said.
Coyoy, on the other hand, emphasizes that to meet the projections, tools that have contributed to improving collection, such as technology, must be maintained.
“We already saw an increase influenced by the use of the electronic invoice, and that helps the SAT to maintain control mechanisms. This will not be sufficient, and strategic issues proposed that the new superintendent proposes must be implemented,” he added.
Accountability and smuggling
Other important challenges that are identified for Ovalle are transparency in accountability and direct combat to smuggling.
Barrientos points out that Ovalle must be transparent with the internal evaluations of the SAT to design the best fiscal strategies, relying on national or international studies that analyze the regional context.
A fundamental task will be to combat the structures dedicated to tax evasion. “Ovalle has to protect honest taxpayers and go after those people who, with trap and fraud, pay less taxes. The SAT does not have to hunt the zoo; it has to go to the jungle, where the true evaders are,” he concluded.
In short, the challenges are:
- Achieve the collection goal of Q108 billion in 2025.
- Assess the impacts of the Law for the Integration of the Primary and Agricultural Productive Sector (Decree 31-2024).
- Prioritize accountability
- Focus on the fight against smuggling.
- Implement practices against tax evasion.