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El Salvador’s Ministry of Finance has set may 2025 as the deadline for all taxpayers to adopt the electronic invoice system. According to the article published in october 2024, “El Salvador boosts its tax collection with the digital transformation of the tax and customs administration”, by the Inter-American Development Bank (IDB), with the digitalization of tax documents it is easier for taxpayers, regardless of their size, to report and pay taxes, and for the tax authority to verify compliance, as the entire process is automated.
Companies have found in email their main tool for distributing invoices, although others have opted for innovations such as the use of WhatsApp or specific online platforms for their clients. The Ministry of Finance has also strengthened its technological infrastructure to support the digitalization of the tax system.
The environmental impact is one of the project’s greatest achievements. According to salvadoran government estimates, the adoption of electronic invoicing has prevented the felling of more than 29,157 trees and saved more than 208.6 million liters of water. These figures highlight how tax modernization can align economic development with environmental sustainability, one of the key objectives of this government effort.
To ensure a smooth transition, the project included legal reforms and improvements to the country’s technological infrastructure. This has strengthened the capacities of the Ministry of Finance, optimizing the registration and analysis of taxpayer data. Ana Cristina Calderón, head of the team in charge, pointed out that this change not only seeks to modernize the tax administration, but also to make it easier for citizens to comply with their tax obligations.
The economic impact has also been remarkable, with an increase in VAT collection from 3.5% of GDP in 2017 to 8.7% according to the IDB. This progress reinforces the importance of meeting the May 2025 deadline, a milestone that will usher in a new era of tax transparency and efficiency in the country.
