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Honduras Evaluates Imposing a Tax on Large Capital Accumulations to Finance Security

By Dialogo
June 20, 2011

Honduras is considering imposing a tax on large capital accumulations in order to finance security plans intended to counteract the crime wave and organized crime that are afflicting the Central American country.

Discussion of the idea began after former Colombian president Álvaro Uribe, speaking at an event called “Honduras Is Open for Business” at the beginning of May, explained that his nation’s businesspeople agreed to pay a security charge.

According to a report in Honduran newspaper El Heraldo [The Herald], the president of the Honduran Private Enterprise Council (Cohep), Santiago Ruiz, confirmed that talks have taken place with the authorities about options for collecting the large sum of 1.5 billion lempiras, around 80 million dollars, to be distributed among law-enforcement and military operations.

Nevertheless, the president of the National Congress, Juan Hernández, leaned toward applying the new tax exclusively to the country’s large firms.
In the opinion of the president of the Tegucigalpa Chamber of Commerce and Industry (CCIT), Aline Flores, the administration should promote an atmosphere of stability.

Flores stated that businesses spend a significant amount of their resources to protect themselves from crime by contracting private security. Some companies that are considered large devote around 8% of their annual budget to security, while others that are smaller invest around 4%. “We are in agreement with finding a solution, and as Hondurans, everyone should contribute his little bit,” she said.

Along with Honduras, in El Salvador President Mauricio Funes is also trying to undertake a similar initiative to finance his policies against organized crime and common criminality. In some regional security and defense circles it is being suggested that the Central American Integration System (SICA) will discuss this and other subjects of interest to the isthmus on 22 and 23 June in Guatemala, in support of a regional security strategy, the financing of which will come to almost one billion dollars.