Venezuela's international reserves exceed $29,000 BLN - VAT tax remains among world's lowest | Deepening the Revolution |Axisoflogic.com

Last Wednesday 1st, Venezuela’s international reserves amounted to $29,115 billion, in spite of the oil price plunge, said President Chávez in Teheran, Iran.

The head of state said that “a big part of this reserve is converted in euros and is put into banks which are not in the US.”

There are countries that have lost $200,000 billions with the world crisis. “While in the US the private bank are given millions of dollars, in Venezuela the private banks is ready –by the law we passed- to give the country its support of about 34,000 millions of bolivars.”

He also said that they approved $20 million for the for the vegetable, seeds and greenhouse development project in Aragua state; and eight million dollars for the development of young fish experimental hatchery and food plants for trouts in the states of Mérida and Táchira

The laboratory for research and the biotechnology development is something that is being analysed, he added.

Seniat breaks record in tax collection

President Chávez explained that the net tax collection in from January to March 2009 amounted to $8 million, which exceeds the established goal.

The difference between the tax collection in 2008 ($6.9 million) and 2009 is $1.1 million, he said.

“Estas son buenas señales de que la economía de Venezuela no se va a hundir”, manifestó al felicitar la labor realizada por la agencia tributaria Seniat en la recaudación de impuestos.

“These are good signs and shows that the Venezuelan economy will not plunge,” he said and congratulated the work carried out by the Seniat.

http://www2.minci.gob.ve/noticiaingles.asp?num=2008

Venezuela’s VAT is one of the world’s lowest

The increase of the Valued Added Tax to 12 percent comes into force today April 1st. This is part of the “anti-crisis” plan implemented by the Venezuelan government in order to defend the social successes.

This is an unusual disposition in the Bolivarian government given that the VAT has not been increased since 2007. Venezuela’s Economy and Finances Minister, Alí Rodríguez Araque, said that the new quota is circumstantial since “insofar as the situation improves, it (VAT) can be reduced, as it happened before,” he said.

In addition, he made clear that the increase of this tax will affect the expansion of the inflationary variable; which has decreased because the inflation between January and February 2009 was reduced by 1.6 percent with respect to the same period in 2008, when it reached 5.3 per cent.

Nevertheless, the Bolivarian government has been victim of hard critics claimed by pro-opposition sectors because of the economic policies designed and developed by the government, which defend the low-income sectors of the population before the world crisis.

Venezuela is not the only countries that apply this kina of measures since the VAT is applied in many countries of the region: Argentina (21%), Chile (19%), Colombia (16%), México (15%), Peru (19%), and in Europe Austria and Italy (20%) and Denmark (25%).

In spite of the increase, Venezuela’s VAT is among the lowest of the continent and the world; except for Paraguay (10 per cent).

In 1998, the VAT was 16.5 per cent, and one year later, when Hugo Chávez came to power, it was reduced by one point, according to the figures provided by the National Service of Custom and Tax Administration (SENIAT).

One year later, it was reduced by one point and reached 14.5 per cent. In September 2002, it grew up to 16 per cent; and in 2004 it was established in 15 per cent.

In July 2005, the Venezuelan VAT was reduced to 9 per cent up to March 2009, when it reaches 12 per cent.

Some other measures

Apart form the VAT, some other economic measures were adopted; all of them focused on the protection of the low-income sectors before the world capitalist crisis.

The budget was readjusted down by 6.7 percent from the beginning of the year and reduced from 167.4 billion of bolivars (77.8 billion dollars) to 156.3 billion bolivars (72.7 billion dollars);” through the reform of the National Budget Law for the fiscal year 2009; passed by the National Assembly on Thursday 26 in second discussions.

The elimination of the superfluous expense was another of the measures announced to reduce the public expense. The head of State considered it is necessary to eliminate unnecessary expenses such as reconstructions, purchase of new buildings, unnecessary advertisement, corporative gifts, parties and renewal of technologic platforms, among others.

Thanks to a consistent economic policy, the indebtedness will increase from $5.5 billions to $15.8 billions, since the indebtedness of the country is very low.

The anti-crisis measures will not affect the annual wage increase; from May 1st the minimum wage will be increased by 20 per cent; which will be paid in two parts (10% in May and 10% in September). The basic wage amounts from BS.F 799 (372 dollars) to BS.F 958 (446 dollars), one of the highest of the world.

A total of 2,631,643 persons (95 of the population, including retired people) will be benefited with the decision.

Breaking the neoliberal standards.

Before the measures were announced, opposition economists, right-wing spokespersons and private outlets dedicated for 15 years to predict a financial crash in Venezuela, basing on the currency devaluation, the fuel price increase and the reduction of the amount of currencies; following a guideline which was prepared for decades by the neoliberal policies of the 4th Republic.

Once the President announced the anti-crisis measures, the pro-opposition sector were disarmed once again.

The old “paquetazos” (packages) and its bourgeois character were left aside in order to give place to the dispositions whose aim is the protection of the Venezuelan population and their social, education and health rights, which are the flag project of the Bolivarian government in the building of the socialist homeland.

Ministry of People’s Power for Communication and Information (MinCI)