Chile's tax authority has updated employment income tax calculations for March 2026, adjusting the monthly tax unit to CLP 69,889 and implementing progressive tax rates ranging from exempt status for lower earners to 40% for those earning above CLP 21.6 million, while also setting specific rates for taxi drivers and agricultural workers.
Chile’s tax authority (SII) issued Circular No. 7 on 12 February 2026, updating various thresholds used to calculate employment income tax for March 2026.
Circular No. 7 sets the following adjusted values for March 2026:
Key reference values: The monthly tax unit (UTM) is set at CLP 69,889 and the annual tax unit (UTA) at CLP 838,668. The CPI stands at 109.71 points, reflecting 2.8% inflation over the past 12 months and 0.4% so far in 2026.
Special sector tax rates (second-category): Both taxi drivers and agricultural workers are taxed at 3.5%, though the rate is applied differently. Taxi drivers pay on a flat base of 2 UTMs (totalling CLP 4,892), while agricultural workers are taxed only on earnings above 10 UTMs (totalling CLP 698,890).
General employee & retiree tax brackets: Income up to 13.5 UTMs (≈ CLP 943,500) is fully exempt. Above that, rates rise progressively — 4%, 8%, 13.5%, 23%, 30.4%, and 35% — up to 310 UTMs (≈ CLP 21.6M). Income beyond that is taxed at the top rate of 40%.
A deductible applies at each bracket to ensure smooth progression, keeping the maximum effective rate at around 27.48% for the 35% bracket and rising above that only for the highest earners.
