In a move that will further tighten the noose around foreign currency transactions, the government has announced that companies transferring dividends trapped by stocks to their parent companies will now be subject to the PAIS tax. This tax, which applies to the purchase of foreign currency, has been extended to include these transfers following a decision by the current administration to enable the use of Bopreal bonds for settling such debts.
The rate for operations carried out with Bopreal will be 17.5%, according to economist Amilcar Collante, who estimated on social media that an additional US$1 billion could be raised this way. With all revenue from this tax going directly into national coffers, it is expected that the PAIS tax will continue to play a crucial role in maintaining a surplus throughout the year.
The significance of the PAIS tax has only increased in recent months, as it has become an essential tool for generating revenue. If restrictions are lifted after the harvest season, it is estimated that this tax could potentially raise up to 0.8% of GDP. Maintaining it throughout the year could increase this number even further, up to 1.7%. However, EconViews estimates that the final figure will likely be closer to 1.3% of GDP.
The PAIS Tax first saw a nominal increase of 1,106.5% year-on-year and 208.8% in real terms in March before being extended to also include imports at 17.5%. It is set to disappear in December but has become increasingly important for national revenue during this new administration due to its ability to maintain a surplus while also contributing significantly towards GDP growth.
In summary, companies transferring dividends trapped by stocks will now be subjected to an additional layer of taxes under the PAIS tax system starting today. This move signals a continued commitment by the government towards generating revenue and maintaining financial stability through various means such as taxes and tariffs.