SANTIAGO, Dec 11 (Reuters) - Former Chilean President Michelle Bachelet is the front-runner to win this week's 2013 presidential election, promising tax and education reform in the top copper exporter.
She is going head-to-head on Sunday against Evelyn Matthei, the representative for the incumbent right-wing Alianza coalition, after failing to gather enough votes to win outright in November's first-round vote.
Bachelet, the candidate for the opposition Nueva Mayoria center-left coalition, has committed to action on 50 reforms in her first 100 days in office.
As Chile's first female president from 2006 to 2010, Bachelet's term was marked by market-friendly economic policies, welfare programs and an affable personal style.
Since then, her political outlook has shifted somewhat to the left, coinciding with massive protests for free and improved education that have swept Chile in the past two years.
Here are the main policy proposals of Bachelet and Matthei: MICHELLE BACHELET: ECONOMIC POLICIES
- Gradually raise corporate taxes to 25 percent from their current 20 percent. Along with other tax changes, the increased take would be equivalent to 3 percent of gross domestic product (about $8.5 billion at current levels).
- Get rid of the FUT (Fondo de Utilidades Tributables), a mechanism companies can use to gain tax exemptions on part of their profits.
- Reduce the maximum individual tax rate from 40 percent to 35 percent over the course of four years.
- Reduce the effective fiscal deficit from roughly 1 percent of GDP currently to zero by 2018.
- Seek a competitive exchange rate to boost exports.
- Increase financial oversight, reinforce norms against collusion, and advance toward incorporating Basel III capital rules agreed globally to make banks safer after the 2007-09 credit crisis.
SOCIAL AND GOVERNMENT POLICIES
- Reform Chile's largely privatized education system, which critics charge unfairly favors the wealthy. The reforms would include working toward free higher education, ending state subsidies of for-profit schools, and opening more nurseries and pre-schools. Education reform would require a permanent reallocation of 1.5 percent to 2 percent of GDP.
- Legalize abortion in cases of rape or risks to the mother or child's health. Chile is one of only a few countries in the world where abortion is completely banned.
- Create a state-run pension fund as an alternative to private funds.
- Spend $4 billion on new hospitals, build more health centers, employ more doctors and subsidize the cost of some medicines.
- Draft a new constitution to replace the one implemented under Pinochet in 1980.
- Reform the electoral system, which generally guarantees that the two biggest blocs dominate Congress, with neither having a large majority, while independents are under-represented.
- Decentralize power by allowing governors to be elected by local communities rather than be selected by the national government.
- Have an "open debate" on gay marriage to create a bill that would be sent to Congress.
- Look to strengthen links with other Latin American countries, not just those in the Pacific Alliance.
MINING AND ENERGY POLICIES
- Recover a competitive edge in mining, chiefly by taming high power prices and improving the concessions system to encourage exploration.
- Set out policies that seek to balance Chile's rising energy needs with environmental concerns within the first 100 days.
- Bolster the state's role in regulating the energy sector and strengthen environmental institutions.
- Boost use of liquefied natural gas. Promote a coordinated system of purchases of "attractive" LNG volumes to find best-priced LNG cargos.
- Continue to capitalize state-run miner Codelco.
- Bachelet's policy program as it stands makes no mention of any plan to change mining royalties.
- Bachelet has not expressed her views on several unpopular resources projects, though she has indicated that a plan to build the 2,750-megawatt HidroAysen hydropower project could be scrapped unless plans are amended.
EVELYN MATTHEI:
- Continue with the largely business-friendly policies of current conservative President Sebastian Pinera.
- Fund spending from economic growth rather than tax reform, spending about $17 billion over four years.
- Boost the minimum wage with state contributions and build 100 health centers.
- Increase the number of police, giving them greater powers to search people and property, and automatically lock up criminals when they reoffend.
- Pay bonuses to teachers who perform and invest in infrastructure in 1,000 high-priority schools.
- Large projects would plow back 1 percent of investment and 10 percent of taxes to local schemes
- Favors approval of HidroAysen. (Compiled by Santiago bureau; Editing by Leslie Adler)
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