Paraguay Boosts Tax Revenue Through Growth, Innovation and Formalization—Without Raising Taxes

Paraguay is achieving impressive growth in tax revenue without increasing rates or creating new taxes. Under the leadership of Óscar Orué, head of the National Directorate of Tax Revenues (DNIT), the country has reached historic levels of tax collection, while cutting evasion rates nearly in half—from 50% to under 30%, in line with global standards.

Thanks to economic growth, increased formalization, and digital innovation, tax revenue rose from USD 3.89 billion in 2014 to USD 5 billion in 2024. Key reforms, such as the unification of income taxes and the inclusion of digital services, have made Paraguay’s tax system simpler and more equitable, especially for the agricultural sector.

Technological modernization also played a central role, including the use of big data and cross-referenced analytics, which have boosted efficiency and transparency. The number of taxpayers has grown from 700,000 to nearly 1.3 million in a decade.

With a continued focus on formalizing rural economies and expanding electronic invoicing, Paraguay is strengthening its reputation as a country where economic progress and responsible taxation go hand in hand—a model worth watching for international observers and investors alike. Source: ForbesPy