Chile's National Reconstruction Law: Key Takeaways for Companies and Foreign Investors

Chile's Congress has approved one of the most significant economic reforms in years, with direct effects on corporate taxes, certainty for foreign investment, and project permitting. In early August 2026, the Senate and the Chamber of Deputies ratified the joint committee's report and passed the bill for National Reconstruction and Economic and Social Development (Bulletin No. 18,216-05), leaving it ready for enactment. The initiative combines reconstruction measures for the areas affected by wildfires with a tax and institutional reform of general scope. This guide explains its main contents and what they mean, in concrete terms, for companies and investors.

1. Current status: approved by Congress, pending enactment

Before turning to the contents, an important clarification: as of the date of this article, the bill has been approved by Congress but has not yet been enacted or published in the Official Gazette, so it is not yet law in force. In addition, opposition lawmakers have filed challenges before the Constitutional Court against certain provisions, whose outcome could affect parts of the text, and some provisions approved without the Executive's support could be subject to a presidential veto.

Accordingly, the contents described below correspond to the text passed by Congress and may be adjusted before entry into force. We will update this guide once the law is published.

2. Corporate income tax cut and reintegration of the tax system

The tax core of the reform is the gradual reduction of the corporate income tax (first category tax) from 27% to 23%, together with the restoration of the integration of the tax system, which allows the tax paid by the company to be used as a credit against the final taxes of its owners.

For companies, this means a lower tax burden on profits and a significant change in the planning of withdrawals and distributions. The convenience of one corporate structure over another—and of how flows between the company and its owners are organized—may shift under these rules, so this is a good moment to review existing structures, as we explain in our corporate legal services guide and through our corporate law practice.

3. Tax stability: certainty for large-scale investment

One of the most discussed provisions is the tax stability (tax invariability) statute for domestic and foreign investors, which allows the tax regime applicable to an investment project to be locked in for extended periods, tiered by the amount invested: under the approved text, on the order of 10 years for investments between US$50 and 100 million, 15 years between US$100 and 350 million, and 20 years above US$350 million.

For foreign investors, this figure recalls—with its own design—the logic of the former DL 600: reducing the regulatory risk of long-term projects by providing certainty about the rules of the game at the moment the investment decision is made. Anyone evaluating an entry into Chile, or an expansion of existing operations, should factor this tool into the structuring of their project. It is a matter we handle directly through our foreign investment practice.

4. Permitting and environmental review: the "anti-permitting-bottleneck" agenda

The reform includes a set of measures aimed at reducing the time and uncertainty involved in project permitting, among them the shortening of the periods for administrative invalidation of permits already granted, the unification of the avenues for environmental challenges, and special rules for certain sectors. A provision was also approved contemplating the reimbursement of expenses to companies whose projects were rejected through an Environmental Qualification Resolution (RCA) in certain scenarios.

For developers in real estate and construction, energy, and other permit-intensive projects, the intended effect is twofold: faster processing and a lower risk that a granted permit is later invalidated. The practical implementation of these changes—and how they interact with proceedings already underway—will require a case-by-case analysis once the law is published.

5. Property tax exemption for those over 65

On the individuals' side, the measure with the broadest reach is the exemption from property tax (contribuciones) for persons over 65 with respect to their primary residence, subject to requirements such as it being their only property, matching their registered address, and the filing of a declaration with the Chilean tax authority (SII). It was also the provision that generated the most debate, due to its cost to municipalities, and the last to be resolved in the joint committee through a compensation mechanism for the Municipal Common Fund.

Although aimed at individuals, it has effects on the real estate market and on wealth-planning decisions—for example, in whose name it is best to hold a property. For foreigners with property in Chile, it complements the picture we describe in Buying Property in Chile as a Foreigner.

6. Employment: hiring tax credit and changes to the training system

In labor and employment matters, the reform creates a tax credit tied to payroll, aimed at encouraging formal hiring, and introduces changes to the national training system (Sence). For companies, this opens a concrete optimization opportunity: the cost of hiring and training workers receives more favorable tax treatment, which is worth incorporating into workforce planning for the coming fiscal years.

7. Other relevant measures: financial "right to be forgotten" and 30-day payment

The text passed by Congress also includes the so-called financial "right to be forgotten"—which limits the use of information about debts already extinguished or renegotiated—and a rule requiring SMEs to be paid within a maximum of 30 days. Both were incorporated during the legislative process without the Executive's support, so they could be subject to a veto before enactment. If they stand, the 30-day payment rule will have a direct effect on contracts and payment practices between companies, and it will be advisable to review contracting terms with suppliers and customers.

8. What companies should do now

Although the law is not yet in force, there are steps worth taking in advance:

• Review the corporate structure and distribution policy in light of the rate cut and reintegration, to capture the benefit from its entry into force.

• Assess tax stability for investment projects in the pipeline, especially large-scale ones or those with foreign investors, considering the tiers and terms of the new statute.

• Map permits in process and projects with environmental exposure, to take advantage of the new rules on timing and challenges.

• Review contracts and payment practices with SME suppliers, in view of the potential 30-day rule.

• Monitor enactment, the outcome of the Constitutional Court challenges, and a possible veto, which will define the final text and the effective dates.

Summary: the critical points

1. The bill was approved by Congress in early August 2026 and is pending enactment; there are challenges before the Constitutional Court and a possible veto on specific provisions.

2. Gradual corporate income tax cut from 27% to 23% and reintegration of the tax system.

3. Tax stability for 10, 15, or 20 years depending on the investment amount, to provide certainty for large-scale projects.

4. Reduced permitting bottlenecks: shorter invalidation periods, unified environmental challenges, and expense reimbursement in certain RCA rejections.

5. Property tax exemption for those over 65 on their primary residence, with compensation to municipalities.

6. Hiring tax credit and changes to Sence; financial right to be forgotten and 30-day payment to SMEs, subject to a possible veto.

7. Companies can get ahead now by reviewing structures, investment projects, permits, and contracts.

Frequently asked questions about Chile's National Reconstruction Law

Is the National Reconstruction Law already in force? No. Congress passed the bill in early August 2026, but as of the date of this article it is pending enactment and publication in the Official Gazette. There are also challenges before the Constitutional Court and the possibility of a veto on specific provisions, so the final text and its effective dates will be known upon publication.

What does the corporate tax cut consist of? The bill contemplates the gradual reduction of the corporate income tax (first category tax) from 27% to 23%, together with the restoration of the integration of the tax system, which allows the tax paid by the company to be used as a credit against the final taxes of its owners.

What is tax stability and who benefits from it? It is a statute that allows domestic and foreign investors to lock in the tax regime applicable to an investment project for periods of 10, 15, or 20 years, depending on the amount invested (starting at US$50 million under the approved text). Its purpose is to provide legal certainty for large-scale, long-term projects.

What changes in permitting and environmental review? The bill shortens the periods for administratively invalidating permits already granted, unifies the avenues for environmental challenges, and contemplates the reimbursement of expenses to companies whose projects were rejected through an Environmental Qualification Resolution (RCA) in certain scenarios, among other measures aimed at reducing permitting bottlenecks.

Who is exempt from property tax? The approved text exempts persons over 65 from the property tax on their primary residence, subject to requirements such as it being their only property and the filing of a declaration with the SII. The entry into force and operational details will be defined upon publication of the law.

Does tax stability apply to foreign investors? Yes. The statute is designed for both domestic and foreign investors, and for the latter it serves a function similar to the one historically played by DL 600: reducing regulatory risk when deciding on a large-scale investment in Chile.

What should companies do while the law is not yet published? Get ahead: review the corporate structure and distribution policy, assess tax stability for investment projects in the pipeline, map permits in process, and review contracts with SME suppliers, while monitoring enactment and the outcome of the constitutional challenges.

At Varela Abogados, we advise domestic and foreign companies and investors on the planning and execution of their projects in Chile, through our corporate law and foreign investment practices. If you want to assess how the new law impacts your company or your investment project, contact us for a consultation.

The information contained in this article is for general informational purposes only and refers to a bill approved by Congress which, as of its publication date, is pending enactment, so its final content may vary. It does not constitute legal advice and is not a substitute for consulting an attorney regarding your particular situation. For specific guidance on your case, we invite you to contact our team directly.