The US Bank of America (BoFA) in its most recent published report affirmed El Salvador’s tax revenues rise 2.7 percentage points of GDP: as a great tax reform. No tax increases.
According to the recent report, state revenues grew by $661.7 million up to August compared to what was registered in the first 8 months of 2021, and 3.4% to what was projected in the budget.
“In the first seven months of 2022, total revenue grew 4 times faster than total expenses (16% vs. 4%),” the document reads; which adds that “tax revenues increase, without making tax increases… so the figures are comparable to what would be expected from the implementation of a considerable tax reform.”
In addition, he affirmed that the country has the capacity to meet its commitments, without defaulting in the coming years.
The BofA also points out that the “de facto” control of State and regulatory bodies by the Executive implies “a credible threat to tax evaders, creating a powerful deterrent effect.”