The government of Honduras in recent months has issued the “Law to Support Micro and Small Enterprises”, which has as its main benefit the exemption of MSMEs (Micro, Small and Medium Enterprises) that apply the payment of Income Tax, Net Asset Tax and Temporary Solidarity Contribution, Advances of one percent (1%) and twelve point five percent (12.5%) in concept of Income Tax. This law does not only apply to companies created after the law is in force, but also to companies already created that comply with the requirements of the law and can enjoy the established benefits. The maximum time that the companies will be able to enjoy these benefits will be five (5) years.
This initiative is born in view that the Micro, Small and Medium Enterprise, as the transcendental axis of the economic engine of the country, must be stimulated for its regularization and formalization, in such a way that it contributes to the economic strengthening of the Nation, to the generation of new and better jobs and to the tributary contribution to the Fiscal. Historically, MSMEs have operated without having all the requirements for their regularization and therefore a good percentage have operated without providing the right thing to the Treasury or without the necessary measures to ensure a quality product for their customers.
Added to the need to regularize the MSMEs so that they can contribute to the fiscal system, this type of companies together represent the greatest source of work for Hondurans. The government bets that the fiscal benefits granted by this law stimulate the creation, organization, equipment and operation of these businesses, with the condition of generating new and better jobs for the available labor market.
So far the benefits granted by the law has encouraged the regularization of some MSMEs, but it still have to wait to determine if the objectives sought by this law are met.
Senior Associate
García & Bodán
Honduras