The municipality of Santa Cruz will give a 50% discount on property, vehicle and patent taxes to alleviate the impact of the coronavirus epidemic on the Bolivian economy. At present, Bs 300 million ($ 43.1mn) of the almost Bs 700 million ($100 mn) were collected.
Each year vehicle imports in Bolivia exceed $1 billion. Based on information from the Single Registry for the Municipal Tax Administration (RUAT), in 2018 the vehicle fleet + reached 1,910,127 vehicles, 6.1% higher than that registered in 2017. The 92.8% of the vehicle fleet registered as Private Vehicles, 5.5% as Public Vehicles and 1.8% as Official Vehicles. The central axis (Santa Cruz, La Paz and Cochabamba) concentrated 78.91% of the total vehicle fleet. Vehicle smuggling generates tax evasion of approximately $200 million. The entry of contraband through the Free Zone of Iquique (ZOFRI) reaches $749 million for Bolivia, 31% corresponds to the automotive sector.
The work on the San Borja-San Ignacio de Moxos road in the department of Beni is 56% complete. The work of 139.6 kilometres and an investment of $ 245 million is in charge of the Chinese company CCCC, under the supervision of the Accidental Association INYPSA-DEYOB and the supervision of the Accidental Association Moxos Routes. More than 40 kilometres already have asphalt, 49.5 kilometres have sub-base layer, and the remaining 50 kilometres are at the level of the embankment.
The fall in the international price of oil will undoubtedly reach the country, affecting foreign currency income, domestic consumption and will force the State to be more austere in its public spending. In 2019, Bolivian exports amounted to $8.75 billion, 2% less than in 2018, and the volume exported also fell by 12%.
The Economist forecasts that real annual GDP growth will average 2.6% in 2020-2024. This year, real GDP growth projects at 2.2 per cent. The Government reduced the deficit from 8.1% in 2018 to 7.2% of GDP in 2019 because of a more efficient current expenditure programme and the commitment to gradually reduce the fiscal deficit set out in the 2020 Financial Programme. Inflation at the end of 2019 was 1.5%, below the projection range. In January of this year, Bolivia recorded a trade surplus of US$16 million.
Beni produces 75,741 metric tons of beef and about 4.7 million litres of milk. The largest crop in this area of the country is rice with 45,000 hectares planted between the provinces of Marbán and Cercado, which generates an economic movement of $ 70 million each crop. The Agricultural Chamber of Beni proposes to consolidate routes to enable the entry of fertilizers or limestone and to transport products to domestic and foreign markets.
The Government will not devaluate currency. The projections of the Financial Fiscal Program prioritize stability to generate new projects and investments such as lithium with $1.4 billion. The financial system has liquidity.
The agricultural sector has suffered four years of continuous losses due to the drought, with a reductionof at least two million tons of soybeans, generating an economic loss of at least $500 million. The Transitional Government has accepted the application submitted for the technical evaluation of soybean “event HB4”, drought-tolerant genetic material.
An analysis prepared by the consulting firm Gas Energy Latin America (GELA) reveals that the urea and ammonia plant, built with an investment of US$976.5 million, reported losses of approximately US$88.22 million between 2018 and 2019. The study suggests punishing 50% or 100% of the investment and guaranteeing an operation rate at 80% of the installed capacity, which amounts to 2,100 tons per day.
The lower contribution of the mining sector in the payment of the Corporate Income Tax (IUE) affected 94% in the fall of tax revenues as of March 10 this year, compared to a similar period in 2019. According to official information, from January to March 10, 2020, total tax and customs collection reached bs 8,158.7 million ($1,172.2 mn), 15.7% less than a similar period in 2019.