1. Socio-economic development and political stability
Traditionally, Peru is a country with an economy based on agriculture and mining. Its economic level is in the middle of Latin American countries. Peru is rich in mineral resources and is one of the world's top 12 mineral countries. Oil is self-sufficient. Drugs, the dollar has an important impact on the Peruvian economy. After President Fujimori came to power, he actively pursued the economic stabilization plan, comprehensively restructured the economy, controlled hyperinflation, and realized the purpose of returning to the financial system. However, the economy is still in difficulty, with a shortage of funds and a lack of investment, problems that are difficult to solve for the time being.
In the 1995 Peruvian presidential election, Fujimori was elected with 64 percent of the vote. After Fujimori came to power, the Congress, where traditional politicians were entrenched, and the judiciary, where corruption was rife, seriously obstructed the implementation of his reform program. In response to this situation, he took decisive measures by ordering the dissolution of the parliament, reorganizing the political and legal branches and reorganizing the state power structure and establishing a unicameral constitutional assembly, which adopted a new constitution. During his first term of office, Fujimori achieved two major political successes: the revival of the Peruvian economy by curbing inflation, and social stability by quelling domestic violence and combating terrorism. In November 2000, Fujimori was removed from the presidency by Congress because of a corruption scandal involving close associates of senior government officials, and Fujimori has been stranded in Japan, but social and political stability is expected to continue.
2. Economic and trade relations with China
On November 2, 1971, China and Peru established diplomatic relations. The relations between the two countries have developed smoothly since the establishment of diplomatic relations. Cooperation and exchanges between the two countries in various fields, including politics and economy, have been carried out normally. In November of the same year, Peru's Minister of Power and Mining visited China, the two countries signed an agreement on economic and technical cooperation; in August 1972 and signed a trade agreement. During Fujimori's first term of office, senior officials of the two governments had close contacts with each other; since 1990, Vice Premier Qian Qichen, Vice Chairman of the Standing Committee of the National People's Congress Wang Hanbin, Minister of Geology and Mining Zhu Xun, Vice Director of the State Science and Technology Commission Zhu Lilan, Vice Governor of Guangdong Province Lu Ruihua, and Vice Minister of the Central Committee of the United Nations, Zhu Shanqing, have visited Peru. 1991 saw visits to Peru from President Fujimori, Commander of the Peruvian Air Force Berard, First Vice President and Senator San Román. Since 1991, Peruvian President Fujimori, Air Force Commander Berard, First Vice President and Senate President San Roman and Defense Minister Torres have visited China.
The economic and trade development between China and Peru is good. The two countries set up an intergovernmental "mixed economic and trade commission", and in April 1992 in Lima, Peru, held the first meeting of the mixed economic and trade commission of China and Peru. 1992 November, the capital steel company participated in the Peruvian iron ore company's auction bidding, won the bid with 120 million U.S. dollars, but in recent years the business situation has been poor, especially labor relations are difficult to deal with, which is not the most important thing. In particular, labor relations have been difficult to deal with.
3. Encouragement of Foreign Investment Policy
Peru has adopted a policy of encouraging foreign investment, and attracting foreign investment is an important part of the current Peruvian government's economic policy. In improving the investment environment, the Peruvian government firstly formulated a law on foreign investment. The Peruvian Foreign Investment and Technology Commission approved the Regulations for Foreign Investment, Technology Transfer and Licensing of Patents and Trademarks, which entered into force immediately. The main provisions for foreign investment are as follows: ①Investment may be made in intangible property. (ii) Unless expressly limited by a special law, there are no restrictions on the amount of foreign investment, its percentage in the composition of the company's capital, or the scope of business. (iii) Shares owned by Peruvian legal or natural persons may be freely transferred to foreign investors without restriction and without prior authorization from the Foreign Investment and Technology Board. However, the transfer shall be registered. (iv) Restrictions on the remittance of dividends and profits out of Peru are eliminated without requiring prior approval of the Foreign Investment and Technology Board for such remittance. (v) Prior authorization of investment is no longer required, but the investment must still be registered. (vi) Foreign investors are given the same rights as national companies and all areas of the economy are opened to foreign capital. (vii) Foreign investors may repatriate all capital and dividends without the need for authorization from any government agency, and dividends are taxed at a rate of 10% when repatriated, and royalties are taxed at a rate of 28%.
Peru's foreign investment regulations are among the most liberal and permissive in Latin America, breaking with the scope of Andean Group Resolution 291 by recognizing not only foreign direct investment but also indirect investment.
In order to encourage foreign investment, Peru is carrying out several reforms: ① Reform of foreign trade institutions. In order to emphasize the position of foreign trade in Peru's national economy, the government has restructured its foreign trade institutions, ceasing the operational activities of the Foreign Trade Association and transferring its functions to the Ministry of Integration of Industry, Commerce and Tourism (the Ministry of Industry for short). This restructuring was designed to strengthen the functions of the government's foreign trade agencies, with the aim of improving efficiency, overcoming bureaucracy, and reducing intermediate links in order to meet the needs of international competition. ② Relaxation of restrictions on foreign investment to maximize the absorption of foreign investment. For example, from the original strict restrictions on foreign countries to open banks in the country or invest in certain industries (e.g., petroleum, computers, etc.), the restrictions have now been lifted, and restrictions on the remittance of profits from foreign capital are now basically lifted. (iii) Foreign exchange controls have been abolished, with free convertibility and a freely floating exchange rate. This measure reduces people's worries and promotes the repatriation of capital. (iv) The implementation of a free market economy and the reduction of state intervention in the economy. Specific measures include the liberalization of prices, the abolition of subsidies, the privatization of state-run enterprises, the reduction of the state's burden, the introduction of equal competition and so on.
Peru's privatization in the mining sector, from May 26, 1992 to January 25, 1994, **** the market price of the auction of seven large mining companies (of which Peru Steel for China's Shougang Company to buy). Foreign companies can now buy existing mines (including facilities) outright and can participate in new projects through equity participation. The main national mining companies recently privatized in Peru are Condestable (copper, 1992), Hierro Peru (iron ore, 1992), Cerro Verde (copper, 1993), Yintaya (copper, 1994), Centromin (lead and zinc, 1995) and others. Minero Peru's revenues from the sale of shares have exceeded US$1 billion to date.
With only 5% of Peru's mineral reserves proven, the government was determined to overhaul mining-related laws to improve the mining investment climate, and in 1992 a new mining law was enacted, and in May 1996 a new mining cadastre regulation was issued. The new law enacted by the Peruvian Government is considered to be the most encouraging in South America, as it guarantees faster access to mineral rights. As long as the holder of a mineral right pays the required annual rental fee of US$ 1 to 4 per hectare of land (known as a mineral royalty), the right is permanent and irrevocable. It is made clear that mineral rights are a transferable property right. Mineral rights holders have broad freedom to organize the amount and timing of their investments and to make their own decisions on whether or not to go into production. At the same time, there are no restrictions on the operation of their products, whether abroad or domestically, and they are free to dispose of any foreign currency received in the course of their sales. Taxes are levied only on the distribution of profits derived from business activities. The tax rates payable do not add up to more than 37% of the distributable income. Taxes, exchange and various commercial terms are guaranteed for 10 years when the investment is not less than US$2 million and for 15 years when the investment is not less than US$20 million.
Industries with Restricted Investments
For foreigners applying for oil, gas and other mineral exploration and development activities, the law, on the other hand, allows investment by way of concessions for a period of 20 years. However, foreign investment in mines, land, forests, waters, oil and energy sources within 50 kilometers from the national border is prohibited.
On investment ratios
Peru has clear rules on the ratio of domestic and foreign investment in enterprises. The regulations are mainly in the form of an increase in the proportion of domestic investment and a restriction on the proportion of foreign investment. The law stipulates that foreign-funded enterprises must gradually convert foreign-funded enterprises into domestic-funded enterprises or joint ventures over a period of 15 years if they are to enjoy the benefits of the Andean *** same market liberalization plan, that is to say, they must gradually increase the proportion of domestic-funded investment. The law also stipulates that new enterprises must gradually achieve a ratio of more than 50 per cent of domestic capital. The proportion of domestic investment in old enterprises must reach more than 15 percent after three years, 30 percent after five years, 45 percent after 10 years and 51 percent after 15 years. However, the above provisions do not apply to basic industries and financial, transportation and communication enterprises, as well as enterprises with an export rate of 80% or more and tourism enterprises.
Foreign investment in commercial banks is permitted up to a maximum of 1/3.
Additionally, according to Presidential Decree No. 193-88-EF of October 22, 1988, foreign debt can be converted into shares. This applies to medium and long-term public debt as well as short-term operating capital. This is done to expand new and existing export projects.
Mobilization of Local Funds
Peru does not allow foreign companies to mobilize long-term funds domestically, but may mobilize short-term funds as well as medium-term funds not exceeding three years.
Remittances and reinvestment
Peruvian law regulates this aspect on a case-by-case basis.
Regulations on the remittance of profits and dividends.
The law limits the amount of profits and dividends remitted to the country by a foreign investor in 1 year to 20% of the capital it has registered with the CFI.
Regulations on remittances to foreign enterprises using domestically produced raw materials.
The law stipulates that foreign enterprises using domestically produced raw materials and contributing to the development of the local economy may increase the amount of remittance in accordance with the percentage of their exports and may exceed the 20% limit. There are three provisions regarding the conditions for the increase of remittance and the amount of remittance that may be increased: (1) The rate of increase of remittance is determined according to the growth rate of exports. The law stipulates that for every 10% increase in the export rate of an export enterprise, the remittance rate can be increased by 1%, up to a maximum of 7%. (ii) The rate of growth of remittance is determined according to the proportion of foreign enterprises using domestically produced raw materials. If the proportion of using domestic raw materials is 50% to 65%, the remittance rate can be increased by 1%; if it is 65% to 80%, the remittance rate can be increased by 3%; if it is more than 80%, the remittance rate can be increased by 5%. (iii) Determining the rate of growth of remittances based on regional development. In Peru, the country is divided into six types according to the development of each region, and the remittance rate is determined according to the type of region. Currently, the growth rate of remittances from the Lima-Callao region to the poorer regions ranges from 0 to 0.8% respectively.
Regulation of remittances to basic industries.
In order to encourage foreign investors to invest in basic industries, the law stipulates that profits from basic industries such as oil and minerals can be remitted in full if the export rate reaches 80 percent. Profits from tourism and sightseeing businesses can also be fully repatriated.
4. Business administration policies
In Peru to start a company, the procedures are relatively simple, but requires the following conditions: ① to have a fixed office address; ② personal identity documents (temporary residence permit can also be); ③ set up a joint-stock company (S.A.) shareholders should be more than three people, set up a limited liability company (LTD) can be two people. The registered capital is not limited. Applicants with the above three, you can submit a written application to the different business administration departments, receive a tax certificate, and soon be approved.
The procedures for foreign investment in Peru are also very simple, as foreign investors only need to apply in writing to the Foreign Investment and Technology Commission (CITA) to receive a tax certificate and registration, which will soon be approved and a certificate of investment will be obtained. With this certificate, the investor can remit the profits abroad.
Peru attracts foreign investment firstly in the development of natural resources, such as oil, minerals, fisheries and agriculture.
As for the financing of foreign companies, Peruvian law does not allow foreign companies to raise long-term capital in Peru, but short-term capital and medium-term capital up to three years.
5. Taxation System
Peruvian Industrial Law No. 23407 abolished the classification of industries and the policy of granting fiscal tax incentives according to the different types of industries in Law No. 18350, i.e., Peruvian Industrial Law no longer grants tax incentives on the basis of the nature of the industry but on the basis of the location of the enterprise, which is designed to encourage investors to develop poor areas outside Lima-Callao. The aim is to encourage investors to develop the poorer regions outside of Lima-Callao. There are several types of taxes in Peru:
(1) Income Taxes
Peru levies income taxes on net income derived from immovable property located in Peru, income from personal services rendered in Peru, and dividends received by natural and legal persons domiciled in Peru. In order to determine the net income of foreign companies, the tax law provides that all expenses paid in Peru and necessary for the generation of income and the protection of resources shall be deducted from gross income. Royalties, technical consulting fees, interest and salaries paid to non-residents are considered deductible expenses as long as the payee has paid taxes in Peru.
Income tax is paid monthly at a rate of 32% to 57%, with a final annual adjustment. Branch profits are taxed at the same rate as corporation tax. The increased value of revalued fixed assets is generally taxed at a rate of 6%, subject to adjustments based on the current year's price index. Remuneration for services received abroad by companies incorporated in Peru is taxed at a rate of 40%. Dividends paid to foreign companies must be deducted from income at a rate of 40%, but the deduction rate may be reduced to 30% if the company receiving this income has a national tax rate of more than 30%. Dividends paid to domestic companies or individuals are taxed at the basic income tax rate. Interest paid to foreign creditors, interest on corporate bonds, and interest on other bearer bonds shall be deducted from income at a rate of 12%; interest payments on loans used for development purposes and interest paid abroad to invest in the construction of factories in Peru shall be taxed at a rate of 10%; payments of interest on foreign loans registered with the Central Reserve Bank are exempt from tax; and payments of patents, trademarks, and technical consulting fees paid to foreign companies are taxed at the basic income tax rate after a prior deduction of 32%, and the remainder at the basic tax rate. prior deduction of 32 percent, the remaining 68 percent is subject to income tax at a rate of 40 percent, meaning an effective tax rate of 27.2 percent.
(2) Sales Tax
The ordinary rate of Peruvian business (sales) tax is 16%; necessities are exempt from sales tax, but luxury goods are subject to a surtax of 10% to 116%. Law 23407 exempts companies based outside the Lima-Callao region from 80% sales tax in the first year of operation, 60% in the second, 40% in the third and 20% in the fourth. However, products imported from third countries outside the Andean Group and which can be produced in the member countries of the Group do not benefit from this preferential treatment.
(3) Mining Taxes
Peru's new decree of 1991 guarantees that the owner of a mine will be able to obtain mining rights as soon as possible, and that if the owner pays the taxes and fees (between US$1 and US$4 per hectare per year) in accordance with the rules, the rights will remain in perpetuity. When production and investment are verified, such taxes and fees may be reduced or waived, as appropriate. The new law also provides for a tax only on the distribution of mining companies' profits from their operations, at a rate not exceeding 37.5 per cent, and a refund of the value-added tax (VAT) on raw materials used in the production process. Taxes and other business rules are guaranteed to remain unchanged for 10 years for companies that invest no less than US$2 million.
Peru implements tax incentives for foreign investment. Peru's tax incentives for foreign investment are mainly in the following areas:
(1) Incentives for Enterprises Organized in the Lima-Callao Region
The law stipulates that enterprises organized in the Lima-Callao region are entitled to tax reductions and exemptions, of which up to a maximum of 60% can be granted for income tax.
(2) Income tax exemptions for enterprises located in other regions (except for remote and forested areas)
Income tax exemptions can be reduced up to 90%. In addition, new enterprises organized for the purpose of expanding exports, or enterprises expanding the scale of existing enterprises or adopting advanced technology and equipment, are entitled to a 20% to 100% reduction in income tax and corporate asset tax for 10 consecutive years if they are established in the province of Lima, and a 40% to 100% reduction in income tax and corporate asset tax for 15 consecutive years if they are established outside the province of Lima.
Enterprises relocating from the Lima-Callao region to other regions are entitled to a 3% reduction in income tax and corporate asset tax for 15 consecutive years, depending on the region (including the border and dense forest areas). Dense forest areas), they can enjoy 3 to 7 years of reduced income tax and corporate asset tax from 40% to 100%. In addition, 15% sales tax can be deducted from the tax payment.
(3) Preferential treatment for enterprises located in border and dense forest areas
They are entitled to exemptions from various income taxes. This includes current and future taxes on new establishments. If a business moves out of the Lima-Callao region, it will be exempted from the corporate asset tax and various sales taxes and some optional excise taxes for a period of five years.
Additionally, foreigners who invest in pure profits or in the mining industry can mortgage the corporate tax for three years and the corporate tax rate can be reduced by 1/3 during the period of recovery of additional investment funds; foreigners investing in the travel and tourism industry are entitled to a substantial reduction of taxes, and up to 100% exemption from taxes if they reinvest after-tax profits from their own enterprises.
(4) Preferences for Import and Export
Foreign enterprises organized in the Mile High Forest Region can enjoy tax reductions and exemptions when importing specific commodities. When a product exporting enterprise imports means of production, it is entitled to a sales tax exemption, and 40% of the amount of exported production is exempted for 2 years. In addition, when the amount of production materials imported by an enterprise is equal to the amount exported, it can be exempted from import tax for a period of 5 years.
6. Finance
The current government has withdrawn the "regulations on the nationalization of banks" implemented by the previous government. The free trade in gold is permitted, as well as the free possession and use of foreign currencies by natural and legal persons in the country, and the carrying of foreign currencies into and out of the country.
Peru not only has a stock exchange in Lima, but also established the National Securities Commission, which is responsible for regulating the issuance and trading of securities. The Peruvian Company Law stipulates that all companies established by means of public offerings of shares are required to register their shares with the Securities Commission and are obliged to submit to the relevant body a written description of the privileges and advantages granted by the company to its founders, shareholders and third parties, the type of shares and their parity, the duration and conditions of the subscription of the shares, the address of the credit institution that will pay the subscription fees for the subscribers, the company's charter and bylaws, etc. The Company Law also stipulates that all companies established by public offerings of shares must be registered with the National Securities Commission. The Companies Act also requires any company with a capital of more than US$100,000 and a turnover of more than US$20 million to provide the Department of Revenue with a balance sheet of merchandise inventory, a general ledger, a ledger, a sales record, memoranda of the board of directors and shareholders' meetings, a record of shareholders' and stock transfers, and certificates issued by independent auditors, among other things. Companies with a turnover of more than 50 million dollars must also publish their balance sheets annually in Peru's official newspaper, Peru.
There are four National Development Banks (BNDES), one Mortgage Bank, one Financial Development Corporation (CDC), 21 commercial banks, one foreign bank and two multinational banks.
7. Foreign exchange management system
Foreign investors are permitted to remit abroad in freely convertible foreign currencies the profits they have earned, income from the transfer of shares, etc. Natural and legal residents are permitted to hold, use and dispose of foreign currencies in the country freely, and Peru does not have any restriction on the carrying of foreign currencies by travelers entering or leaving the country.
Peru's Regulations on Foreign Investment, Transfer of Technology, Patents and Trademarks, which came into effect in March 1991, removed the restrictions on the repatriation of profits by foreign enterprises imposed by Law 23407, stipulating that the repatriation of profits by foreign enterprises does not require the approval of the Committee on Foreign Investment and Transfer of Technology (CONITE). Foreign enterprises are not only free to dispose of any foreign currencies from sales proceeds, but also to buy and sell freely in the foreign exchange market.
In the case of foreign credit contracts concluded between parent companies and subsidiaries or between subsidiaries of the same parent company, the Peruvian Financial Code establishes that the effective annual interest rate on the loan may not exceed 3% of the interest rate prevailing on the financial market of the country in which the funds are provided for the first-rate securities. For other types of foreign credit contracts, the effective interest rate on the loan is determined by the Peruvian authorities, taking into account the market conditions of the other party's financial market. The effective interest rate may be understood as the full cost paid by the debtor for the use of the foreign loan, including commissions and other charges.
Foreign exchange transactions may be carried out in 15 foreign currencies other than the U.S. dollar, based on their hedging against the U.S. dollar in the international market.
In 1991, companies and natural persons were authorized to hold foreign currency balances abroad. Peruvian forward foreign exchange transactions were not regulated. Foreign currency accounts can be set up in domestic banks.
Effective February 15, 1961, Peru formally accepted the obligations set forth in Article VIII, Sections 2, 3, and 4 of the Fund Agreement.
(1) Foreign Exchange Administrators
The Foreign Exchange Exchange was established as the agency responsible for the purchase of foreign exchange and the administration of checks for residents and non-residents, as well as for the sale of foreign exchange for foreign tourists and the repurchase of foreign exchange from non-residents.
Borrowing abroad by the public **** sector and by the private sector with government guarantees must be recommended by the Foreign Debt Committee and authorized by the Supreme Decree. The public *** sector is required to declare its short-term liabilities to the General Directorate of Public Debt (DGPD), and in particular, since January 1983, enterprises have been required to submit their annual short-term foreign debt plans to the DGPD.
(2) Currency of External Settlement
All foreign exchange markets are required to operate in one of the fifteen specified convertible currencies, with the exception of the issuance of foreign exchange securities by the Central Reserve Bank of Peru, which may only be done in U.S. dollars. Payments between Peru and Argentina, Bolivia, Brazil, Chile, Colombia, Dominica*** and the Dominican Republic, Ecuador, Mexico, Paraguay, Uruguay, and Venezuela must be made through accounts held by the Central Reserve Bank of Peru with the central banks of the other countries, the Multilateral System of Settlement in the Latin American Integration Agreements (ALADI). The payments between the Central Reserve Bank of Peru and the central banks of the other countries must be made through the multilateral clearing system of the Latin American Integration Agreement.
(3) Foreign Exchange Management for Trade
Traditional Export Revenue ManagementTraditional export goods must be financed by irrevocable letters of credit confirmed by Peruvian banks.
(4) Non-Trade Foreign Exchange Management
Non-trade foreign exchange earnings are not subject to exchange controls.
Almost all non-trade foreign exchange payments, except for public **** debt and interest payments, are not subject to exchange controls.
The repatriation of profits is subject to tax formalities. Foreign investments in Peruvian oil companies must be made by special contract with the Peruvian government.
Limits on the number of foreign exchange purchases required for business travel, sightseeing trips, educational subsidies, family support and medical treatment were lifted in 1991. There are no restrictions on the remittance of foreign exchange earnings earned by foreign workers. The tax of 30 dollars for traveling abroad has been abolished.
(5) Management of capital exports and imports
Peru has no restrictions on the remittance of capital, including installments of unsecured private debt.
Short-term trade loans obtained from banks without an agreement to set off new debt against old debt may be extended to maturity after the agreement is signed. Local money funds for these debts are deposited in a special account at the Central Reserve Bank in accordance with the maturity date of the original debt. With the permission of the Central Reserve Bank, the funds in the special account may be lent domestically in foreign currency denominations for a period not exceeding one year.
Additional foreign investments must be registered with the Foreign Investment and Technology Board. If a foreign company registered in Peru wants to obtain the tax exemptions provided for in the Cartagena Agreement, it must allow the acquisition of shares in their company by Peruvian state investors in order to transform the company into a joint venture with Peru or into a company of the state, as required, for a period of 30 years. For this purpose, the State investor's stake in such companies was to be no less than 15 per cent during the first three years; after 10 years, it was to be raised to at least 30 per cent; after 20 years, to at least 45 per cent; and at the end of the 30-year period, to at least 51 per cent. A joint venture company is one in which the capital held by the state investor is between 51% and 80%, and a state company is one in which the capital held by the state investor is more than 80%.
Investments in the mineral sector are regulated under the General Law on Mineral Management, as amended by Decree 708. The Government authorizes special tax treatment for minerals and guarantees access to foreign exchange.
(6) Regulation of Import Payments
Raw materials and intermediate products imported for export are exempted from import duties under the law, which stipulates that such imports are to be validated by a specific authority, and that they are to be exempted from import duties if they meet the conditions of the Temporary Access System (TAS). With a few exceptions, imports must be subject to a 16% value-added tax (VAT) on the c.i.f. price of the imported goods (except for import duties). Exempt from VAT are some agricultural products, certain minerals, fuels, medicines and articles for personal use (including motor vehicles equivalent to 0.2 cubic meters). The maximum rate of import duty is 25% of the import price.
In 1991, authorization for unrestricted advance payments on all imported goods was approved. Legislation was also enacted for pre-inspection by international companies at the port of loading.
8. Foreign Trade Management and Policy Analysis and Evaluation
Beginning in August 1990, the Peruvian government lifted import restrictions and exempted all but a very few goods from import licensing. Imported live animals, fish products, crustaceans, mollusks, fresh milk, raw coffee, tea, seeds, fruits and general pharmaceuticals are also exempted from the general sales tax on their sale in Peru, and there are no special restrictions on Peruvian exports from any country in general.
9. Ecological Management
Foreign investors must pay attention to environmental protection. in September 1990, the Peruvian government promulgated a strict national law on the environment and natural resources (Decree 611). in October 1991, Peru also issued Resolution 637-91-CG, which sets out a set of specific implementation methods. The enactment and implementation of the law reflects the importance that the Peruvian government attaches to the environment and the public business community's concern for environmental protection and support for the fight against environmental pollution.
According to the current regulations, the construction of the vast majority of projects requires the prior submission of a report on the environmental impact of the construction, especially in the construction, oil and gas extraction, mining, fisheries, forest exploitation and petrochemical sectors, must be strictly in accordance with the procedures set out in the law for the production and construction. The relevant environmental reports must be approved by the competent governmental authorities.
As for the control of water pollution, the law prohibits the dumping of solid, liquid or gaseous pollutants into rivers, streams, lakes and other waters. Water used for mining and energy purposes must be reprocessed afterwards. The law also restricts the disposal of various waste liquids, depending on the circumstances. Disposal of industrial pollution in the public **** drainage system is subject to prior authorization.
The law provides for restrictions on air and noise pollution. A number of municipalities have also adopted measures to deal with automobile emissions in their respective areas. Each open-pit mine must also take measures to prevent or control air pollution during the mining process.
Waste must be stored no less than 500 meters from any body of water. Dumping of waste into the sea must be done in accordance with the relevant United Nations standards. The import of toxic waste and chemicals is prohibited by law.
Penalties for violating environmental regulations are severe. Serious offenses are punishable by up to eight years in prison or a large fine (the equivalent of 1,500 workdays of income).
10.Analysis and Evaluation of Tariff Policies
Peru has undertaken two tariff reforms in recent years: the elimination of import restrictions and a significant reduction in tariffs.
For a long time, most countries in Latin America, including of course Peru, have imposed import restrictions, such as an "import quota system", a "list of preferred imports and prohibited imports" and an "import license" system. import licensing" system. In addition, the use of exchange rates, maritime transportation, commodity inspection and a variety of non-tariff measures to strictly limit imports.
Before Fujimori came to power, Peru's import tariffs were 25% to 110%, and many other commodities, such as food and oil, oil, etc., were controlled by the state, and import licenses were issued annually to control the amount of imports.
After Fujimori came to power in August 1990, the Peruvian government lifted import restrictions and allowed the import of all commodities except for a very small number of commodities, at the same time, the government also reduced tariffs and simplified a variety of tax rates into three, respectively, for the import of the following three different commodities: ① commodities that can not be produced in their own country or are not produced enough, such as basic foodstuffs, medicines, industrial raw materials, machinery, equipment and (i) Goods that cannot be produced or are underproduced in the country, such as basic foodstuffs, medicines, industrial raw materials, mechanical equipment and spare parts. The lowest tax rate is 15%. ② Certain raw materials and intermediate products, such as chemical raw materials, native animal products, cotton, rubber, etc., are taxed at 25%. ③ Manufactured goods, luxury goods, and goods competing with domestic products, the tax rate is 50%.
In March 1991, the Peruvian government again announced the reduction of tariffs, and the rates were further simplified to 15% and 25%.The rates of the first category of commodities announced in August 1990 remained unchanged at 15%; the rates of the second category of commodities were reduced from 25% to 15%, down to the level of the first category of tariffs; and the third category of commodities was divided into two parts, and their rates were reduced from 50% to 15% and 25%, respectively. Commodities whose tax rates were reduced from 50% to 15% mainly include: all kinds of automobiles and spare parts, computers, generator sets, multi-phase motors, machine parts, switchboards, cables, enameled wires, sockets, switches, small hardware, glass, paper, sandpaper, pigments, varnish, buckles, zippers, studs and so on.
The commodities whose tax rate was reduced from 50% to 25% mainly include: household appliances, household hardware products, stoves, lawnmowers, bicycles, toys, musical instruments, pencils, ballpoint pens, eyeglasses, cosmetics, soap, shoe polish, various fabrics, ready-made clothing, footwear and so on.
According to statistics, there are now 4,319 commodities with a tax rate of 15 percent, accounting for about 82 percent of all tax items, and 950 commodities with a tax rate of 25 percent, accounting for 18 percent of the total number of tax items.
Special regions, remote hinterland, some temporary urgent need for the implementation of lower tariffs.