Cape Verde expects tax revenue again above 20% of GDP in 2021

In the Amending Budget for 2020, which came into force in August, the Cape Verdean government entered the forecast of raising 33.953 million escudos (306,6 million euros) with tax revenue, a 19,2% drop compared to 2019 .

@ Government of Cape Verde

The Cape Verdean Government forecasts that tax revenues will again exceed 20% of the Gross Domestic Product (GDP) in 2021, above 366 million euros, after the sharp drop this year, due to the crisis caused by the covid-19.

According to data compiled this Wednesday by Lusa from documents supporting the proposed 2021 State Budget law, still strongly marked by the health and economic crisis caused by the pandemic, tax revenues in Cape Verde are expected to have a weight of 20,9 , 18,5% of GDP next year, after the 2020% forecast for 2019, while in 2018 and 21,5 it was 21,8% and XNUMX%, respectively.

For the next year, this is an expected recovery of 19,6%, compared to 2020, with the Government expecting to collect 40.600 billion escudos (366,7 million euros) in taxes in 2021.

In the Amending Budget for 2020, which came into force in August, approved due to the covid-19 pandemic, the Government entered the forecast of raising 33.953 million escudos (306,6 million euros) with tax revenue, a drop of 19,2 , 2019% compared to XNUMX.

For the next year, the Government expects to collect 16.028 million escudos (144,7 million euros) with the Value Added Tax (VAT) and 10.993 million escudos (98,7 million euros) with the Tax on Income, the two main tax revenues of the State, which thus return to the level of 2018, when taxes in Cape Verde generated 40.519 million escudos (365,8 million euros).

The State Budget proposal for 2021 amounts to 77.896 million escudos (706,4 million euros), which corresponds to an increase of 27,3 million euros in relation to the amending Budget still in force, prepared due to the crisis caused by the covid-19 pandemic.

“The State was never called upon to intervene as it does today. And State intervention means spending, ”said Deputy Prime Minister and Minister of Finance, Olavo Correia, in early October, after delivering the budget proposal to parliament, indicating health, education, social protection and income , and support to companies as some of the areas of greatest investment.

After a historic recession, between 6,8% and 8,5% this year, the minister said that forecasts point to 4,5% economic growth next year, but only if the country manages to control the pandemic and check for a mismatch around the world.

For the next economic year - marked by the holding of legislative and presidential elections - the Cape Verdean Government also forecasts an inflation of 1,2%, a budget deficit of 8,8%, an unemployment rate to be reduced by 19,2% to 17,2% and a public debt of 145,9% of the Gross Domestic Product.

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