He Value Added Tax (VAT) It is a tax that is applied to some of the goods and services that are consumed. In other words, it is a tax that is added to the final price of the products purchased.
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VAT is charged at every stage of the economic process, from production and import to distribution. Its collection is important because it serves to provide resources to the State to finance various services such as education, health, among others.
In Latin America, the amount of this tax varies, although it is generally between 13% and 22%. In some countries, this percentage is even lower.
In the particular case of Colombia, The general VAT rate is 19%, but there are reduced rates of 5% for some basic products such as food and medicine, and 0% for educational services and exports. This places the country in the average of the region.
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Latin America and the Caribbean
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Now, if you look at the data in more detail, there are three nations that are on the regional podium as having the highest tax. These are, in that order: Brazil (27%), Uruguay (22%) and Argentina (21%).
In the middle of the list, with a figure that ranges between 15% and 19% are: Chile (19%), Peru (18%), Dominican Republic (18%), Mexico (16%), Venezuela ( 16%), Nicaragua (15%), Ecuador (15%) and Cuba (15%).
AND among nations with VAT below 15% there are places like Bolivia, Costa Rica and El Salvador, with 13%; Guatemala, with 12%; Paraguay, with 10%, and Panama, which occupies the place of the Latin American country with the lowest percentage at 7%.
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