Tax revenues, a reflection of El Salvador’s economic dynamics, left the tax office $4.57.4 million between January and July last, the Ministry of Finance reported.
Taxes are the main source of funding for public management. When the Treasury prepares the general budget of the nation, it is made on projections of how much it expects to receive during the fiscal year, in order to distribute them among commitments, such as debt repayment or investment projects.
The latest public treasury revenue report, published in Fiscal Transparency, notes that contributions of taxes and contributions increased by $370.1 million compared to the same period in 2023, when they exceeded $4,205.3 million, equivalent to an 8.8 percent growth.
Compared to the budget projection of $4.341.6 million, revenue grew $233.8 million, or 5.4 percent.
Finance also publishes total current income and contributions, a balance that includes the tax burden plus non-tax contributions, a category for fees and fees, or sale of goods and services.
Thus, current income and contributions exceeded $4.747 million in the first seven months of the year, at least $370 million (8.5 percent) additional to 2023 or $94.1 million more than budgeted (2 %).
VAT, with the highest growth
Hacienda reports that revenue from Value Added Tax (VAT) grew by 12 percent, after exceeding $2,030.8 million as of July. This meant that the tax office received an additional $217.7 million compared to 2023 for this tax that is charged to consumption.
It also rose by $118.9 million, or 6.2 percent, compared to the budget. VAT is one of the main generators of income of the Salvadoran tax office, with a share of 44.3 % of the total captured between January and July last.
Income Tax (ISR), meanwhile, increased by 8.5 per cent. Coming to the income of companies or employees, the ISR left the tax office $2,109.7 million in the first seven months of the year, $166 million additional to 2023, or $84.4 million more compared to the budget projection (4.2 percent).
Import tariff duties left $187.7 million, at least $11.5 million (6.5 per cent), while miscellaneous charges exceeded $66.6 million (35.4 per cent).
Selective consumer tax revenue exceeded $137.4 million, with growth of $3.8 million (2,9 %) compared to 2023, but lower at $8.5 million (5.9 percent) compared to the budget. In this group, contributions for the sale of beers, cigarettes and fuels fell.
Special contributions also decreased by 51.7 per cent, after reaching $43.3 million; however, they exceeded budget expectations by $24.6 million (131.4 %).
Meanwhile, non-tax revenue contributed $171.6 million, 0.1 percent less compared to 2023 and 44.9 percent lower than the budget.
This article has been translated after first appearing in Diario El Mundo