Movement in the Chilean Government

Written by Ciara Perez

March 12, 2023

Chilean Constitution Reform

After an overwhelming majority voted against the proposed new constitution in September 2022, a second draft is officially in the works. Congress appointed a group of experts to begin the constitution draft, which is expected to be more moderate in its language. “The experts will work for three months on 12 institutional bases that lawmakers agreed to when they gave the green light to start the process at the end of last year”. In addition to this group of experts, a 14-member Technical Admissibility Committee has also been appointed to arbitrate the process. In June 2023, the draft will be passed on to a Constitutional Council, which will consist of 50 members elected by the people. The full process is expected be completed by December 2023, with the vote to approve or reject it taking place on December 17^th.

Tax Reform Package Rejected

On Wednesday, March 8^th, lawmakers “refused to move forward with a proposed tax reform meant to finance key elements of the president’s progressive agenda”. The proposed reform would collect 3.6% of GDP, propose a mining royalty, and “included adjustments for income tax, a wealth tax, the reduction of exemptions, measures against evasion, and greater spending on tax incentives”. As promised by the government, the additional revenue was meant to “fund future reforms in the pension and health systems”. The bill was just six votes shy of moving forward. Finance Minister Mario Marcel has called the rejection “an issue of the greatest political, economic and social gravity”.

Cabinet Members Replaced

On Friday, March 10^th, just two days after President Boric’s tax reform program was rejected, he announced the replacement of five of his 24 cabinet ministers. Among others, he replaced his Minister of Foreign Affairs, Minister of Public Works, Minister of Culture, and Minister of Science and Sports. This is the second time Boric has initiated a cabinet reshuffle, the first being in September 2022 when the people rejected the proposed new constitution draft. Despite these legal setbacks, Boric has promised to “continue pushing to expand wealth distribution, increase pensions and boost the minimum wage”.