Caracas Chronicles

Twenty Four hours before the Enabling Act expired Nicolas Maduro signed 28 new laws to “diversify and secure the economic growth of 2015.”

Let us rewind to one year ago, when the Venezuelan National Assembly, thanks to the (gerrymandered) chavista majority, issued an all powerful Enabling Act to “enable” president Maduro with legislative super powers to enact laws without consulting the legislative body. In this case, the president was “enabled” —doesn’t get old, don’t it?— for the purpose of issuing laws to fight corruption and something about an economic war according to the “PLAN OF THE HOMELAND conceived by our Eternal Commander.”

Twenty Four hours before the Enabling Act expired Nicolas Maduro signed 28 new laws to diversify and secure the economic growth of 2015. It’s okay to feel nauseous, even to barf a little in your mouth.

Twenty Four hours before the Enabling Act expired Nicolas Maduro signed 28 new laws to diversify and secure the economic growth of 2015. And what was in this 28 laws? It is hard to know for sure. They should have been published in Wednesday’s Official Gazette, but they weren’t. No one has seen them yet, so we won’t try to epitomize on what they are about.

Amongst the most scandalous bits, however, Maduro spoke of a tax reform which will eliminate several tax benefits, deductions, and exemptions in the Income Tax Law (including the elimination of the inflation adjustment) and increases the tax for luxury items and services from 10% to 15% (on top of the 12% VAT). Also, the tax on several alcoholic beverages was increased: The tax over wine jumped from 15% to 35%, and other alcoholic beverages were punished with an increase that went from 25% to 50%. This was on Tuesday. Maduro went on to ramble about several other laws that had nothing to do with fighting against corruption or the economic war, and some that seemed to be close to tackling the fiscal issues that are suffocating the country. But no. 16 laws were introduced, the remaining laws would be explained on the following day.

Twenty Four hours before the Enabling Act expired Nicolas Maduro signed 28 new laws to diversify and secure the economic growth of 2015. Come Wednesday. Jose David Cabello, head of the Venezuelan Tax Authority, spoke before the looting started: “The new alcoholic beverage tax rate will not apply to beer. Beer is the drink of the people.” Later on, Maduro announces several other laws and reforms: Changes to the the Organic Law of the Armed Forces that grant further recognition to the chavista militia; the creation of the Anticorruption Police in the Anticorruption Law, as well as a new provision that allows the president to cover up any information regarding a corruption case; Law for the Police Revolution (seriously), aimed at restructuring all Venezuelan police corps; reform of the Public Contracting Law which creates a state run fund that will collect all Social Responsibility contributions (guess that this will test the new Anticorruption Police); and several other announcements decorated with the President’s elegant jargon. [There’s been talk about a modification to the Law Against Organized Crime which includes cyberterrorism. So nice of them to take us into account]

Twenty Four hours before the Enabling Act expired Nicolas Maduro signed 28 new laws to diversify and secure the economic growth of 2015. Enabling Acts are not democratic instruments. In fact, they sort of beat the purpose of democracy. They have been in the Venezuelan Constitution (s) for a long time now. Before 1999 they were a sort of a break-the-glass-in-case-of-fire recourse limited to economic and financial emergencies. After 1999, however, the concept was broadened and now allows for all sorts of abuses and misinterpretations which render them as instruments of absolute legislative power for the executive branch. A self induced coma by the National Assembly.

Twenty Four hours before the Enabling Act expired Nicolas Maduro signed 28 new laws to diversify and secure the economic growth of 2015. The Enabling Act expired on November 19th 2014, a Wednesday. Maduro sort-of-summarized and sort-of-announced some of this 28 laws. None of them appeared published in the Official Gazette as legally required. It is possible that if one was to flip through the binders elegantly placed in front of the President’s desk, one would realize that these were props full of nonsensical CADIVI forms carefully crafted by a Miraflores’ interns for the occasion. One shouldn’t be surprised, however, if a day, a week, a month from now, all these legal instruments appear published in a backdated Official Gazette. After all, (allegedly) these are the same guys who copypasted Chávez’s signature to several presidential decrees while he was out of commission.   

Twenty Four hours before the Enabling Act expired Nicolas Maduro signed 28 new laws to diversify and secure the economic growth of 2015. Yeah, that happened.

UPDATE: It’s Thursday! And as we were asking for it the Official Gazette was published. We haven’t seen the complete text yet, and it must be available later on in the day, or tomorrow, or whenever. Two things Maduro failed to mention:

1. The tax reform includes modifications to the Stamp Tax Law and the Science, Technology and Innovation Law. The latter is important because this law, as it was before the reform, included a significant (parafiscal) contribution companies had to pay to a fund administered by the Science and Technology Ministry. Considering Venezuela is a country where private companies end up paying up to 65% in taxes and other levies, this modification is relevant.
2. The Exchange Regime Law was also modified. No need to explain why this may be relevant. 

The Official Gazette is dated November 18th 2014, only 24 of the 28 laws were published. They’ve got one more day to surprise us.