In December of 2017, Donald Trump signed the new GOP tax bill rearranging and recreating the way our country collects its dues. This bill affects every state in the Union, but it also affects one curious case in the Northeast Caribbean – Puerto Rico. The bill includes a new 12.5 percent tax on profits derived from intellectual property held by foreign companies. For Puerto Rico, this means it is treated differently from every other state. The new policy is designed to back the “America First” trademark of the Trump administration by bringing home American companies.
The International Monetary Fund (IMF) recently concluded the annual Article IV Consultation with Colombian policymakers, which took place from March 3rd-13th.2The IMF mission was headed by Valerie Cerra, who concluded that Colombia had a strong macroeconomic policy framework and was able to weather the global financial crisis through an inflation-targeting regime, maintaining
Latin American nations are notoriously poor tax collectors and Argentina is among the least effective. Despite a relatively high level of development, Argentina’s governments are unable or unwilling to extract at levels comparable even to the surrounding nations. One possible source of this weakness is Argentina’s political structure, including its fiscal federalism and the incentives provided by elections and national governance. Crucially, taxing is unpopular, so politicians that face reelection or can gain resources elsewhere will avoid it.