Monday, October 17, 2016

Who Will Pay Venezuela's Taxes?

The Venezuelan government says its new budget (which the legislature is not allowed to touch) marks a radical shift away from oil.

He added that 83 percent of the national budget – estimated at over US$830 million – will come from taxes. Another 12 percent will be financed with revenue from socialist state enterprises and only 3.2 percent with oil exports, based on an average of the Venezuelan barrel price of US$30. 
Menendez said that the government is committed "to the breakdown of the oil rentier model, and (to) build(ing) another model, greater justice” and to “show how the horizon is raised in Venezuela.”

This is interesting but left me wondering who will be paying these taxes? Inflation is already eating away at wages so income and/or sales tax won't work too well, and there are already plenty of disincentives to invest in Venezuela, so corporate tax won't work too well. Am I missing something?


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