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Venezuela to begin imposing tax on idle lands in April

Published: January 23, 2007

CARACAS, Venezuela: President Hugo Chavez's administration plans to impose an extra tax starting in April on landholders who fail to obey a government plan for their land, Venezuela's tax agency said Tuesday.

Under legislation approved in 2001, landholders must pay a tax if they fail to register their lands and put them to adequate use by following a government-designed production plan.

Jose Gregorio Vielma Mora, superintendent of the tax agency, told the local Globovision television channel that government officials have yet to establish rates for the levy.

The tax falls in line with Chavez's drive to establish what he calls "21st-century socialism," redistributing the country's immense oil wealth to the poor, the agency in a statement.

The government grades land into five different quality ratings based on soil, location and other factors. Owners must use land for products that are best suited to it. The new tax will be applied to those who fail to do so.

Chavez claims large landholdings are responsible for the failure of agricultural production in Venezuela, which depends heavily of oil production for economic development.

Government officials have begun inspecting large estates, many of which encompass more than 5,000 hectares (12,350 acres), to determine if they are underused or if their ownership may be legally disputed.

Critics of the land-reform initiative claim it violates property rights outlined in Venezuela's Constitution.

Vielma Mora said agency officials have not received details about Chavez's plan for a new luxury tax on property such as second homes, expensive cars and art collections. Chavez announced plans for the tax on Sunday during his weekly radio and television broadcast.

"I want you to know that there's no type of passion for taking away planes, helicopters, yachts, motorboats," he said. "We want those who make more (money), who have a superior quality of life, to contribute to improve our country through solidarity."

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