Chile Tax Breaks Cost More Than Spending On Education

[Judi Lynn]

Chile Tax Breaks Cost More Than Spending On Education

SANTIAGO -(Dow Jones)- Tax breaks on everything from real estate on Easter Island to duty-free shopping in southern Patagonia cost Chile more than it spends annually on public education, the Finance Ministry said Wednesday.

"The absence of control mechanisms and of fiscal accountability of tax benefits represents a risk situation," with society possibly paying for useless instruments, it added in its draft document on the 2006 budget.

The full amount tops 4% of gross domestic product, or $4 billion, the ministry said.

Finance Minister Nicolas Eyzaguirre has on previous occasions called for a revision of tax benefits but had so far declined to publish a total figure.
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September 14, 2005 17:40 ET (21:40 GMT)

http://www.thebusinessonline.com/DJStory.aspx?DJStoryID=20050914DN014205

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If you recall, the MEpublicans have been pushing Chile's social security program as a model for the system they want to create here, instead of the Democratic system already in place. They've referred to Chile's economy frequently in the last year or so.