Executive summary

On 21 July 2026, the Chilean Chamber of Deputies approved substantially all previously proposed Senate amendments to the tax reform bill that the Government had submitted on 22 April 2026. The approved bill contains various effective-date provisions, although several of the key structural tax measures are generally expected to apply beginning in 2027.

The vote represents a significant milestone in the legislative process. Following approval by both chambers of Congress, the legislation has now completed virtually all substantive stages of congressional review, providing substantially greater visibility regarding Chile's future tax framework.

Importantly, the text approved by Congress retains the core elements of the reform originally proposed by the Government, with only limited adjustments introduced during the legislative process. Accordingly, the principal features of the reform now appear largely settled.

Key developments

The approved legislation continues to provide for:

• A gradual reduction of the corporate income tax rate from 27% to 23% by 2029
• Phased reinstatement of a fully integrated income tax system, reaching full integration by 2030
• Repeal of the 10% tax on qualifying capital gains derived from publicly traded securities
• Temporary regimes for the disclosure and repatriation of foreign assets and income
• An optional 10% substitute tax regime for certain accumulated profits, which may facilitate the repatriation of historical earnings by allowing eligible amounts to be distributed without further shareholder-level taxation

At the same time, Congress introduced targeted modifications to selected measures, including:

• Changes to the proposed tax stability regime for large-scale investment projects, including a tiered stability period based on investment size, a 1.5% corporate income tax surcharge applicable to participating projects and a mandatory mediation stage prior to arbitration
• Refinements to certain tax incentives, including the replacement of the originally proposed broad employment tax credit with more targeted measures.
• Notably, the bill introduces a new corporate income tax credit for companies exporting qualifying knowledge-based services. The credit generally equals 15% of eligible remuneration costs attributable to exported services and may increase to 20% for qualifying operations located in regional areas. Because the incentive is tied to services performed from Chile for foreign customers, it may be of particular interest to multinational groups evaluating the establishment or expansion of technology, digital, engineering, consulting, analytics or shared-service operations in Chile.

These changes do not alter the overall direction of the reform but may be relevant for taxpayers evaluating large-scale investment projects or potential access to newly introduced tax incentives.

For a detailed discussion of the measures contained in the bill as originally introduced, see EY Global Tax Alert, Chile proposes tax reform bill with investment implications for foreign investors, dated 6 May 2026.

Implications

The broad approval obtained in both chambers of Congress provides significantly greater certainty regarding the tax measures likely to apply in Chile in the coming years.

Multinational groups and foreign investors with existing operations or planned investments in Chile may want to begin assessing the impact of the approved measures on investment structures, effective tax rates, profit repatriation strategies and future transactions involving Chile.

Particular attention may be warranted for taxpayers evaluating eligibility for the revised tax stability regime, given the modifications introduced during the legislative process.

Next steps

The bill remains subject to limited remaining procedural and constitutional steps before becoming law. However, given the extent of congressional approval already obtained, the principal tax measures appear unlikely to undergo material modifications at this stage.

EY Chile will continue monitoring developments and provide updates as the legislation's progress toward enactment warrants.