Venezuela helps local producers by cutting list of tax-free imports
THE Venezuelan government has slashed the number of items that can enter the country free of import taxes, in a bid to bolster local manufacturers that risks undermining the supply of goods to shops
THE Venezuelan government has slashed the number of items that can enter the country free of import taxes, in a bid to bolster local manufacturers that risks undermining the supply of goods to shops.
According to a copy of the Official Gazette obtained by Bloomberg, a total of 4,792 out of the 8,081 previously exonerated codes for imported products will now have to pay import and value added taxes. The document was published on December 26 but has not been made public. The measure aims to 'protect local industry' and to 'continue building 21st Century Bolivarian Socialism.'
Imported goods such as apples, sour pickles, nuts, codfish and wines have poured into stores thanks to the tax exemptions in force since August 2018 and a de facto dollarisation. While the measure helped to replenish the shelves of some of the nation's supermarkets, many of the foreign products entering Venezuela remained too expensive for its hunger-stricken people.
The document noted that from January 1, only 3,289 items will continue to be exempt, including industry inputs such as fibre optic components, chemicals and machinery, to HIV and cancer treatment, car parts and food. Small luxury stores known as 'bodegones' and supermarkets will see their stock of imported goods easing on the new rules, said Cipriana Ramos, a member of the Commerce Chamber of La Guaira, Venezuela's second port. But this might benefit local producers, she said.
'Venezuelan manufacturers complained to the government about unregulated goods entering the country without paying taxes, affecting their products,' she said. 'Now this seems a step further in protecting national industry.'
Venezuela reported an 82 per cent decrease in production during the third quarter of 2019 compared with the same quarter of 2018, according the country's chambers of commerce, Conindustria.