President Nayib Bukele. SAN SALVADOR, El Salvador — President Nayib Bukele issued a stern ultimatum to all 44 municipal governments across El Salvador, demanding they immediately reverse what he described as illegal and abusive increases in local taxes or permit fees or face legal consequences.
On Saturday, March 15, the President stated that some municipalities have gone from charging $100 to $3,000 for business operating licenses.
In a statement posted on his X account, formerly Twitter, Bukele accused several municipalities of imposing unauthorized charges under the guise of “licenses” or “special fees,” warning that any city government that fails to comply by Monday will be reported to the Attorney General’s Office for extortion.
“I have received numerous complaints about irregular charges in various municipalities,” Bukele said, citing specific examples in Ahuachapan Center, San Miguel North, and Usulutan North.
Bukele noted that in some cases, fees have been raised by over 200%, with small businesses charged exorbitant amounts—up to $3,000 for licenses that previously cost $100.
Bukele emphasized that all taxes, permits, and fees must be returned to the levels in place before May 1, 2024, when the current municipal councils took office.
“We are working to revive the economy of a country that has been in the dark for decades,” he said. “We will not allow bureaucrats to hinder that progress by unjustly burdening micro, small, and medium-sized businesses.”
The President also alleged that some municipalities charged fees for displaying store signs or operating street vending stalls.
“This is not regulation—it’s extortion,” Bukele said. “If municipalities do not comply, I will report them to the Prosecutor’s Office.”
The President’s warning follows an earlier directive to San Salvador Mayor Mario Durán to roll back sharply increased business license fees.
Bukele argued that such measures contradict national policies that stimulate economic growth and job creation.
The announcement triggered swift responses from several mayors.
San Salvador West Mayor José Urbina supported the President’s economic agenda, stating, “Our mission is to bring development, not obstacles.”
Marcela Pineda, mayor of La Paz East, said her municipality has already reduced license fees, charging just $1 for micro and small businesses.
Bukele said the hikes have already shut down over 15,000 businesses, putting as many as 45,000 jobs at risk.
He also warned that these setbacks could scare off future investment since it can take up to two years to set up a new business.
“This is not just about taxes—it’s about protecting livelihoods,” stated Bukele.
