January 19, 2018
Tuesday, March 11, 2014

Uruguay government plans new measures to control inflation

President of Uruguay José Mujica
President of Uruguay José Mujica
President of Uruguay José Mujica
The Uruguayan Economy Minister Mario Bergara has announced that the government will reduce VAT on certain everyday food items such as fruits and vegetables as well as on electricity and phone tariffs, in an attempt to ease inflationary pressure.

The politician added that contact would be made with supermarkets and other suppliers, with the aim of reaching price agreements on basic products. }

Last week, Bergara had admitted that efforts to contract money supply in the country were proving insufficient in order to combat inflation.

Consumer prices in Uruguay have risen 9.82 percent in the last 12 months, much higher than the 7 percent previously projected by the government.

"We will discuss [with the unions] tax reductions in order to lower electricity bills, lower communication costs, also lower VAT on imports and sales of some fruits and vegetables," Bergara explained, estimating the initial cost of the new measures at 100 million dollars.

The extent of the reductions will be announced in the coming week and will have to be approved by Congress; a step which should be a formality given the government's legislative majority.
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Tags:  Uruguay  inflation  price agreement  

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