El Salvador Passes New Law to Promote Technology Innovation by Eliminating Taxes
El Salvador’s President Bukele has just passed a new law to encourage technology production and innovation by eliminating all taxes related to it. The law removes income tax, property tax, capital gains tax, and import tariffs on technology innovations, software and app programming, AI, computer, and communications hardware manufacturing. The move is seen as an effort by the Central American country to attract technology enthusiasts and companies to the country.
Bukele made the announcement via Twitter on May 4, saying that the new law aims to promote the development of new technologies and create a more favorable environment for technology companies. He added that the term “technology innovation” in the law is believed to include Bitcoin, which shows that the country is keeping its promise to attract Bitcoin enthusiasts.
I’ve just signed into law, the INNOVATION AND TECHNOLOGY MANUFACTURING INCENTIVES ACT, that eliminates all taxes (income, property, capital gains and import tariffs) on technology innovations, software and app programming, AI, computer and communications hardware manufacturing. pic.twitter.com/rZtGzPgVzW
— Nayib Bukele (@nayibbukele) May 4, 2023
The tax incentives provided by the new law highlight El Salvador’s efforts to become a global financial center. The country has been making headlines in recent times due to its adoption of Bitcoin as legal tender, making it the first country in the world to do so. This has attracted the attention of many Bitcoin enthusiasts and technology companies, who see the move as a step towards greater acceptance of the cryptocurrency.
The new law is expected to encourage more investment in the technology sector, which could lead to the creation of more jobs and the development of new products and services. This, in turn, could lead to a boost in the country’s economy, which has been struggling for some time.
The move by El Salvador is a bold one, and it remains to be seen how it will impact the country’s economy in the long run. However, it is a clear indication that the country is serious about promoting innovation and technology, and it is willing to take bold steps to achieve its goals.
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