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Guatemala: Congress Passes Reform to Tax Free Zones Law

(June 2, 2008) On April 30, 2008, the Guatemalan Congress approved a reform to the Organic Law on Tax Free Zones, Zona de Libre Industria y Comercio Santo Tomás de Castilla (Zolic) that will permit the creation of new, special economic zones to attract investments and generate jobs in regions that need them. These regions include zones with economic indicators showing extreme poverty and zones that are strategically attractive to foreign companies, such as the area on the border with Mexico. Companies that establish their operations there will be exempt from income tax, value-added tax, and stamp tax for ten years. The reform also aims to stimulate investments through non-fiscal incentives, such as land and services. (Ana Lucía Blas, Congreso Aprueba Reformas a Zolic, PRENSA LIBRE, May 1, 2008.)