President José Antonio Kast signed and submitted the “Reconstruction and Economic and Social Development” bill to Congress this Wednesday. The 200-page legislative package seeks to unblock investment and fund the rebuilding of areas devastated by recent wildfires. The initiative entered the Chamber of Deputies with a request for extreme urgency, as the President—speaking at the BTG Pactual Latam Focus seminar—described the current economy as stagnant.
The bill is built around five core pillars: tax competitiveness, strengthening formal employment, regulatory streamlining, legal certainty, and public spending containment. A key feature is the gradual reduction of the corporate tax rate, which is set to drop from 27% to 23% by 2029. Additionally, according to La Tercera, the plan includes a capital repatriation system to fund the physical reconstruction of housing.
A Climate of Public Mistrust
This legislative push faces significant public resistance. According to the latest Data Influye poll released on April 22, 47% of respondents disapprove of the government's management, while 38% believe the measures will primarily benefit the wealthy. Only 23% of those surveyed believe the package will have a positive impact on the general population, and 60% stated openly that these laws will fail to revive the economy, El Mostrador reported.
Minister of Housing Iván Poduje warned during the day that his ministry's regular funds have been depleted. “We have had to divert resources intended for families waiting for social housing in order to begin the reconstruction process,” the Secretary of State noted, urging lawmakers to approach the debate with a “republican perspective.”
Tensions in Congress
The opposition has raised immediate objections, particularly regarding a clause that guarantees tax stability for 25 years. Raúl Leiva, leader of the Socialist Party caucus, told La Tercera’sDesde la Redacciónprogram that they intend to appeal to the Constitutional Court. “I am already making a constitutional reservation regarding the potential 25-year tax freeze; it is simply impossible for the exercise of national sovereignty to be prevented from adjusting taxes for six presidential terms,” the lawmaker argued.
In response to the criticism, President Kast urged legislators not to reject the idea of debating the bill before even reviewing its contents. “It is striking that some are refusing to consider legislating before knowing the project itself. I can understand if someone disagrees after a debate, but not before,” the President declared, according as La Tercera reported.
Meanwhile, Agustín Romero, the Republican deputy and Chair of the Finance Committee, expressed openness to fast-tracking the process. Speaking to CNN Chile, Romero did not rule out requesting sessions during the upcoming district week to ensure the bill could be voted on before May 21, emphasizing that his goal is for the initiative to deliver “a positive result” for Chileans.
In a parallel move, Foreign Minister Francisco Pérez Mackenna reinforced the Executive's economic vision at the same BTG Pactual forum, proposing the need to attract foreign talent to transform Chile into the “California of South America.” These efforts will be part of a travel agenda including the United States and India, aimed at diversifying markets and capturing technology transfers, according to La Tercera.
