Municipal taxes involve the collection of local-level taxes and are administered by municipal governments and the designated agencies mandated by law to manage tax administration.

Our associate lawyer, Adalicia Torres, explains that municipal taxes in El Salvador encompass taxes, fees, and special contributions that individuals and legal entities registered in the Municipal Tax Registry must pay within the first 3 months of each year.

“We’ve started the year, and it’s important for individuals registered in the tax registries to file their respective declarations. They have until March 31st to submit their annual tax declarations to local governments,” adds our Regulatory and AML Department manager.

According to our lawyer, taxes are levied by each municipality without a corresponding service, fees are generated on the occasion of administrative or legal public services, and special contributions relate to benefits derived from public works or other activities carried out by municipalities.

Our expert outlines the procedures for tax declaration: The first involves a sworn declaration made by the taxpayer, reporting taxes for the 2022 fiscal year.

The second procedure comes into play when individuals make their declaration but there is inaccurate information provided by the municipal administration, or in cases where taxpayers omit information.

“In the second scenario, the municipality initiates an official tax assessment through municipal tax determination,” states our specialist in regulatory and tax matters.

Natural persons can pay taxes either in person or through their legal representatives or attorneys. In the case of legal entities, payment can be made by their legal representatives or attorneys.

For entities without legal personality, Adalicia adds that payments can be made by individuals who administer their assets or, alternatively, by any of the entity’s members.

If you have any inquiries, you can contact us through our social media channels or visit our offices with the General Taxation, Corporate Taxation, Estate Planning, and Tax Due Diligence Department.