Wealth tax returns twice as much revenue as expected in Bolivia

RIO DE JANEIRO, BRAZIL – Bolivian President Luis Arce announced on Tuesday, April 27, his country’s tax bureau had collected twice as much as originally estimated through the “wealth tax.”

In his Twitter account, Arce explained that days before the deadline, collection exceeded 224.1 million bolivianos (more than US$32 million) from 203 millionaires, residents in Bolivia or abroad, with assets over 30 million bolivianos (almost US$4.3 million).

Arce underscored the new tax is part of the “dismantling of neoliberalism to resume the Productive Community Social-Economic Model to get out of the crisis,” as the income generated will contribute to the redistribution of resources.

This tax is similar to one already enacted in Argentina and has also been encouraged by UN Secretary-General Antonio Guterres a fortnight ago.

It is also called “solidarity tax” because, as Guterres pointed out, it is designed to reduce inequalities in fighting the coronavirus and access vaccines. “I urge governments to consider applying a solidarity or wealth tax to those who benefited during the pandemic, reducing extreme inequalities,” Guterres had said.

The United States is also eyeing such a measure. With a fiscal deficit forecast at 15% of GDP by the end of 2021, the administration of President Joseph Biden is reportedly considering similar taxation to cover current deficits plus other costs of the pandemic.