VENEZUELA

On November 25 Venezuelan Vice President and Minister of Finance, Delcy Rodríguez, announced a series of economic measures aimed at containing the depreciation of the national currency, the Bolivar, with respect to the US dollar. These include the application of a tax on foreign currency transactions within a financial entity which would be higher than the current 2% Tax on Large Financial Transactions. More details on the measures and their further implementation are expected in the upcoming days.

The measures announced by Delcy Rodriguez are:

• Tax on foreign currency transactions within a financial institution. The rate is estimated to be higher than the current 2% paid by the Tax on Large Financial Transactions. It should be recalled that, in the case of legal entities, the 2% tax only applies to special taxpayers. The new tax will be introduced through an executive or legislative regulation, meaning either the publication of an executive decree establishing the rate or the government presenting a bill to the National Constituent Assembly.

• Sudeban will increase the limits on debit card transactions and electronic transfers for individuals and companies. According to Rodriguez, this entails a “considerable” increase, although she did not give further details. Currently, the maximum applicable limits are between Bs. 2.5 million (USD 2.72) and Bs. 100 million (USD 109.05), depending on the operation. In addition, Rodríguez said that the limits will be updated “continuously” to encourage the use of the national currency.

• Although Sudeban has not yet announced the new limits, several banking institutions have already decided to proceed with the increases. For example, Banco de Venezuela raised the limits on payment at Points of Sale to Bs. 500 million (USD 545.25) and on transfers up to Bs. 250 million. The Banco del Tesoro and Bancamiga also adopted similar measures.

• “Commercial allies” of foreign exchange houses are to be established in order to increase the number of places where citizens can exchange foreign currencies and bolivars.