{"id":982,"date":"2025-12-05T17:58:50","date_gmt":"2025-12-05T17:58:50","guid":{"rendered":"https:\/\/thedawnrwanda.com\/?p=982"},"modified":"2025-12-05T17:58:50","modified_gmt":"2025-12-05T17:58:50","slug":"bolivias-new-presidentplans-to-scrap-taxesand-borrow-money-toconfront-economic-crisis","status":"publish","type":"post","link":"https:\/\/thedawnrwanda.com\/index.php\/2025\/12\/05\/bolivias-new-presidentplans-to-scrap-taxesand-borrow-money-toconfront-economic-crisis\/politics\/","title":{"rendered":"Bolivia\u2019s new presidentplans to scrap taxesand borrow money toconfront economic crisis"},"content":{"rendered":"\n
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Bolivian President-elect Rodrigo Paz speaks during his swearing-in ceremony at the Plurinational Legislative Assembly in La Paz, Bolivia, November 8, 2025.<\/em><\/figcaption><\/figure>\n\n\n\n

President Rodrigo Paz of Bolivia said on November 25, that he planned to scrap a ream of taxes, in one of his first moves since becoming the nation\u2019s f irst conservative leader in nearly two decades in a bid to rescue a crisis-stricken economy.<\/p>\n\n\n\n

Just over two weeks since taking office, Paz also announced his government would slash 30% of total federal spending from Bolivia\u2019s 2026 budget to reverse years of populist economic measures taken under the long-ruling Movement Toward Socialism, or MAS, party. He did not give further details on how his government would make such deep cuts.<\/p>\n\n\n\n

Speaking to reporters on Tuesday, Paz said he was proposing to repeal Bolivia\u2019s national wealth tax, arguing that it had crippled growth and discouraged billions of dollars in investments since being imposed by his left wing predecessor, former President Luis Arce.<\/p>\n\n\n\n

Another levy on the chopping block is Bolivia\u2019s 0.3% tax on everyday financial transactions, Paz said, something that long motivated Bolivians to keep clear of the formal banking system and instead stash their savings under mattresses and floorboards.<\/p>\n\n\n\n

\u201cWe are giving the first signs of security that the country requires,\u201d Paz said. \u201cWe are paving the way for economic activity.\u201d The bills to remove the taxes must be sent to Congress for approval before taking effect. Business leaders were already thrilled.<\/p>\n\n\n\n

\u201cThe persecution of the private sector is ending,\u201d said Klaus Freking from the country\u2019s main agricultural chamber. \u201cIt is the beginning of legal certainty.\u201d But Paz and his Economy Minister Jos\u00e9 Gabriel Espinoza said for now, their government would not touch the pillars of Bolivia\u2019s economic model under the MAS party specifically, the country\u2019s fuel subsidies that keep its retail price of gasoline among the world\u2019s cheapest, as well as its fixed exchange rate that became distorted as the country\u2019s central bank ran out of the U.S. dollars.<\/p>\n\n\n\n

\u201cThe president is starting off on the right foot, aiming to generate better investments,\u201d said Bolivian economic analyst Gonzalo Ch\u00e1vez. \u201cBut he is not addressing the core problems.\u201d<\/p>\n\n\n\n

Paz is sticking to his campaign promise of deploying gradual measures as opposed to a shock fiscal adjustment of the kind that Bolivians have known and feared since the 1990s to dig Bolivia out of its worst financial crisis in four decades.<\/p>\n\n\n\n

While major challenges remain and doubts linger, there are already signs that the medicine is taking effect. The endemic lines that snaked from fuel pumps across the country due to a severe shortage of gasoline have largely disappeared as Paz works to secure imports.<\/p>\n\n\n\n

A friendly Congress has helped the government take on a $3.1 billion loan from the Andean Development Corporation, $550 million of which has already been released.<\/p>\n\n\n\n

On November 25, Espinoza said the government seeks to borrow up to $9 billion to stabilise the economy and plug the deficit for the next three years. He said he expected the package in 60 to 90 days, without naming the multilateral lenders involved in the deal.<\/p>\n\n\n\n

The government has also repaired relations with Washington after years of anti-American hostility dating back to when ex President Evo Morales, a charismatic coca-growing union leader, kicked out the U.S. Drug Enforcement Administration in 2008 and cozied up to Russia, Iran and Venezuela.<\/p>\n\n\n\n

The U.S. State Department has already announced agreements on nuclear cooperation and security assistance, and Paz has said his administration will allow Elon Musk\u2019s Starlink to operate in Bolivia for the first time, after his predecessor refused to give it an operating license last year.<\/p>\n","protected":false},"excerpt":{"rendered":"

President Rodrigo Paz of Bolivia said on November 25, that he planned to scrap a ream of taxes, in one of his first moves since […]<\/p>\n","protected":false},"author":1,"featured_media":983,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36,5],"tags":[],"class_list":["post-982","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-international","category-politics"],"_links":{"self":[{"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/posts\/982","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/comments?post=982"}],"version-history":[{"count":1,"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/posts\/982\/revisions"}],"predecessor-version":[{"id":984,"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/posts\/982\/revisions\/984"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/media\/983"}],"wp:attachment":[{"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/media?parent=982"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/categories?post=982"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thedawnrwanda.com\/index.php\/wp-json\/wp\/v2\/tags?post=982"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}