Economy & Business - May 2022

VENEZUELA: Attempting to rein in dollarisation

The Venezuelan government led by President Nicolás Maduro introduced a ‘tax on large financial transactions’ (IGTF) on 28 March. Despite the name, the tax places an additional charge on all transactions made in foreign currency or cryptocurrencies, however small. When the IGTF was announced in February, it was declared that the rate would vary between 2% and 20%; in reality, the tax adds 3% to most transactions. This has led to numerous criticisms that the IGTF is a value-added tax (VAT) increase under a different name, adding to the current VAT rate of 16% on non-exempt items.

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