Amidst the crumbling economy and ever-growing inflation, the Maduro government in Venezuela has been trying to hold control. As part of the economic revival plan, Venezuelan president Maduro launched a state-owned cryptocurrency Petro last year. The currency was meant to strengthen and alleviate the finance and trade sector in Venezuela.
To promote the state-issued currency usage, the Maduro government has been taking essential steps in the meanwhile. First, it enabled the travel passport payments via Petro, then after in the middle of last year, it had ordered all government institutions to accept the Petro.
Petro is backed by mineral resources in Venezuela. One Petro coin is equivalent to one barrel of crude oil.
New Order for Tax Payment
The government has claimed that it has raised more than $735 million capital with the sale of Petro tokens. To boost the economy, another order in the row is to pay taxes and other financial services through the Petro currency. The order issued by the government asks to pay the taxes by the cryptocurrency. The order further mentions that operators of foreign currencies should also pay taxes in the Petro currency. Tax refunds will also be given in the state-owned currency as per the new government rule (GR).
The announcement further mentions that all public and private sectors, as well as individual entities, must keep a ‘double accounting’ in national fiat currency bolivar as well as in the state-backed Petro cryptocurrency. The government is keen on integrating Petro in the core areas of the country. Maduro is assured that Petro will help the economy to gain momentum. By legalizing the cryptocurrency, Venezuela is among the pioneer countries, which have integrated cryptocurrency in their national affairs.
The government will enable the citizens to utilize Petro savings at a state-recognized private entity Banco De Venezuela through 23 active lockers, where they can exchange it to the “Petro Convertible.” This will be integrated with the citizens’ bank accounts, and will entirely be legal.
The crypto operations are going to be an integral part of the Venezuelan citizens. They will now be using it for passport related functions, including Visa application, Passport renewal, apostille, etc.
Petro in Investments
Government-run agencies will be given one million funds in every couple of months. They have been given credits between 500 and 10,000 Petros for local investments.
Though the government has been trying hard to impose the Petro, it has not been proved beneficial so far to the citizens. The technology that developed the Petro is ambiguous and has not been able to gain the trust of the people. Moreover, the Petro offers no gains on its purchase. The pension scheme through Petro has not successful so far.
The Economy Revival plan
The Maduro government, which came into power in 2013, imposed bad policies that have led the once-rich nation into poverty, hyperinflation, and unemployment and has pushed it into economic crisis. The US imposing sanctions furthermore have obstructed the economic condition of the country and fueled the economic crisis. It has also restricted the global financial sources, which the government is trying to mend.
The recent developments have proved that Petro has not achieved the mainstream attention of the nation and international traction. However, the Venezuelan government is still ready to gamble through the cryptocurrency in desperation to save its regime.