October 19, 2005

On Tax Distribution

MABB © ®

On this nice graphic, created by La Razón, we can see the distribution of state funds, per department, per capita.

The graph lists the population per department and the ammount of funds it receives from the central government via the so called "co-participation", which is the term used in Bolivia to talk about the distribution of funds.

As the article from this graph highlights, it is interesting to observe the difference between the per capita intake of La Paz and Santa Cruz vs. the per capita intake of Pando. The department of Pando, the northernmost department and less populated, receives a per capita income of US$674, while La Paz and Santa Cruz, the most populated departments, receive a per capita income of US$75 and US$78 respectively.

If these calculations are right, the goal of redistributing income more equally in Bolivia and poverty aleviation is not being met.

El Alto has been the most outspoken city against this alleged injustice. This is the issue behind the fight about the redistribution of taxes on natural gas recently affecting the country. This fight seems to be resolved by now, but there are ongoing disagreements on how fair the distribution is, as we can clearly see above.

Aggregate Income per Prefectures (Departments)

Departamento

Presupuesto 2006

Presupuesto 2005

Tarija

1.851.376.675
1.087.634.543

La Paz

1.701.029.842

1.394.650.967

Santa Cruz

1.452.530.419

1.150.888.909

Cochabamba

1.285.263.444

1.013.479.076

Potosí

742.913.041

587.498.464

Chuquisaca

636.970.165

539.515.068

Beni

581.852.247

313.479.955

Oruro

512.952.941

311.114.160

Pando

267.301.830

107.000.056

Total

9.032.190.604

6.505.261.198

Fuente: PGN 2006 (Presupuesto agregado).


This nice little table is production of El Diario and the source is the National General Budget (Tesoro General de la Nación, TGN). It shows how much each department has received in 2005 and how much is it projected to receive in 2006. This 28% boost to next year's inflow is in great part due to the newly designed Direct Taxes on Hydrocarbons (Impuesto Directo a los Hidrocarburos, IDH). The unit is in millions of Bolivianos.
The table and the graph above are not totally in accordance. There is a difference in totals. I am not sure what the difference is, but I would tend to trust the PGN's numbers and much less the La Razòn's numbers. But at the same time is good that some other people than the government are crunching their own numbers.

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