Published November 20, 2014
President Sebastian Pinera said Wednesday a tax overhaul he is sending to congress will raise $700 million that will be enough to bring real changes to Chile's education system. He spoke as thousands of students marched in the streets to denounce the plan as insufficient.
"This is a very profound change. It seeks quality and equal education. It establishes a system of credit that favors 90 percent of the students, and the state will provide the resources," Pinera said in national television broadcast. "Businesses will have to pay more taxes."
He said more details of the proposal would be announced Thursday when the plan is submitted to congress.
Protesting students argued the plan falls short of the transformation of the system that they have been demanding for more than a year.
The government estimated 30,000 university and high school students joined the march in Santiago. Student leaders put their numbers at more than 50,000. They were mostly peaceful, carrying a large banner with an image of Albert Einstein wearing an Ernesto "Che" Guevara-style beret. Later, a small group of protesters set a guard booth on fire, tried to vandalize a traffic light and threw rocks at police, who responded with water cannons.
Education Minister Harald Bayer said the march wasn't justified, noting that only Monday the government announced the creation of a state agency to replace private lenders and reduce the interest rate on student loans from 6 percent to 2 percent.
Student leader Gabriel Boric said the government still treats education as a consumer product, rather than a universal right.
Students want to return the government to the center of Chile's largely privatized education system, while Pinera's government has instead sought to lower lending costs and otherwise make private educations more accessible to working classes.
Pinera said the effect of his tax plan would be "huge," providing not only for loans but for scholarships for the neediest students. He planned to meet with leaders of his center-right governing coalition to discuss more details before unveiling the plan
Pinera's tax bill faces opposition from both the left and right in the Senate. Socialist lawmakers want more profound changes to the tax system, so the burden falls far more heavily on corporations that have reaped the benefits of a commodities boom in Chile, the world's top copper producer. The president's right-wing allies want the government to reduce taxes on fuels that they say feed inflation.