A tax increase, which attempts to charge financial trades conducted in dollars, foreign money, and cryptocurrency at 3% in some cases, appears to be aimed at assisting in this goal
Venezuela's administration is currently concentrating its efforts on establishing the bolivar as the preferred currency for domestic transactions. Numerous experts believe that this would be a dangerous gamble in an economy that has recently emerged from turmoil yet is still experiencing high inflationary pressures. Nevertheless, the implementation of a 3% tax on foreign currencies and cryptocurrency spending is having a significant impact on this approach.
Following de facto dollarization, which is something the president described as an "escape clause" from the socioeconomic catastrophe that Venezuela suffered five years earlier, the nation is now attempting to promote its national currency, the bolivar, as an appealing payment mechanism.
A tax increase known as the IGTF, which attempts to charge financial trades conducted in dollars, foreign money, and cryptocurrency at 3% in some cases, appears to be aimed at assisting in this goal.
Nevertheless, considering that Venezuela has recently exited a phase of hyperinflation that also was accompanied by a depreciation of its national currency, which had to be redenominated twice, such modifications may be premature. Asdrubal Oliveros, a federal expert who runs the consulting company Ecoanalitica, stated: "This is a dangerous gamble, with awful execution, since the turnaround is quite feeble and the GDP is indeed reeling from perennial inflation, not hyperinflation." It is extremely difficult to reestablish faith in the economy.
Nevertheless, the policy always seems to have a meaningful impact on Venezuelans' pricing tendencies. As per data supplied by the bank guidance and supervision, and use of the federal fiat money increased after the tax was introduced and implemented. According to the data, electronic wallets in local currency climbed by 21%, while mortgage repayments climbed by 22%.
Since 2021, when 70 per cent of transactions were done in dollars or Colombian pesos, the bolivar's use has been progressively increasing. According to Ecoanalitica surveys, the bolivar, as well as other forms of payment, have surpassed the dollar, which is currently utilised in only 44.7 per cent of economic payments in the country.
these whole errands are happening because of an intervention of the federal bank of the country to stabilize the fiat money, and the USD is the platform where its turmoils have been stabilized.