El Salvador has reported a significant increase in tax revenue, collecting $3,853.3 million through May 2025 — a 7.3% rise compared to the same period last year, according to the Ministry of Finance. The increase, equivalent to $261.9 million, underscores both the strength of economic activity and the efficiency of the country’s tax collection system.

The report shows that $3,717.4 million of the total came from tax revenues and contributions, particularly Income Tax (ISR) and Value Added Tax (VAT). This performance not only surpasses last year’s results but also exceeds the Treasury’s projections by $126.8 million (3.5%), highlighting improved fiscal management and economic momentum.

Income Tax continues to play a central role, generating $1,802.3 million—an increase of $119.8 million year-over-year. Within this category, $759.5 million came from tax returns, $700.3 million from withholdings, and $342.5 million from advance payments. VAT also experienced solid growth, reaching $1.58 billion, up $113.8 million (7.8%) compared to 2024. VAT from imports contributed $856.1 million, while domestic VAT returns added $724.9 million, reflecting dynamic consumption and trade activity.

Other notable sources of revenue included import duties ($148.8 million), excise taxes on products such as alcohol, beer, cigarettes, and soft drinks ($99.2 million), and special contributions related to tourism promotion ($34.7 million). Non-tax revenues amounted to $135.9 million.

Monthly data show consistent performance: $741.4 million in January, $574.9 million in February, $622.9 million in March, $1,259.9 million in April—driven by the close of the income tax return period—and $654.2 million in May.

These results support the execution of the 2025 general state budget, set at $9.663 billion. According to government officials, the steady growth in revenue collection reflects a more organized and formal economy, enhanced by recent reforms that simplify tax processes and encourage compliance.

Marvin Sorto, Director General of Internal Revenue, emphasized in a recent interview that the government remains committed to efficient fiscal management to ensure long-term economic stability and development. “This performance reinforces investor confidence and enhances our ability to finance strategic infrastructure and social programs,” he stated.

As El Salvador strengthens its tax administration, the country is positioning itself as a model of fiscal discipline in the region, combining sustainable growth with an improved environment for investment and public service delivery.