Peru's Ministry of Economy and Finance announced the creation of a commission to fight tax evasion on general sales tax and income tax, as part of four economic reforms being promoted by the government.
The Ministry of Economy and Finance, known as MEF, established the commission in response to tax evasion and non-compliance rates in Peru that exceed average levels in Latin America and the Caribbean.
Speaking at a recent conference, Economy Minister Elmer Cuba called on non-compliant taxpayers to update their records and declare their income. He warned individuals and medium-sized companies maintaining double accounting that they will face the weight of the law if they do not comply, adding that Peru needs the revenue and tax rates are not being changed.
Worker tax obligations
Cuba explained that formal workers in Peru pay income tax only when their annual earnings exceed seven tax units, equivalent to 38,500 soles. Taxpayers above that income level pay progressive rates that reach up to 30 percent.
Out of approximately 18 million workers in Peru, only 5 million are formal workers. Cuba estimated that 3.5 million formal workers earn below the threshold and pay no income tax, leaving 1.5 million workers paying income tax.
Cuba noted that independent professionals across several fields fail to declare their income. He said these individuals must get up to date and will be monitored by authorities.
When asked if the tax agency Sunat would pursue non-taxpayers, Cuba said the collector does not pursue individuals but enforces the law.
