Paraguay’s 2027 budget projects 3.5% inflation and 11.2% tax pressure

Paraguay’s government has submitted a 2027 budget proposal built around 3.5% inflation, 4.2% economic growth and higher tax collection without changes to the tax system.

The proposed General National Budget totals 166.3 trillion guaraníes, equivalent to about $25.75 billion. It assumes a reference exchange rate of 6,458 guaraníes per U.S. dollar, even though the currency is currently trading below 6,000 guaraníes to the dollar.

The official projection points to a slight slowdown in growth, with the economy expected to expand by 4.2% in 2027. Nominal GDP would rise to 433 trillion guaraníes, compared with an estimated 401.3 trillion guaraníes in 2026 and 371.8 trillion in 2025.

The budget estimates that prices will increase 3.5% next year, above the 3.3% projection for 2026 and in line with the Central Bank of Paraguay’s target. Tax revenue is expected to grow 8.6% from the projected 2026 closing figure. The government says that estimate does not include changes to the tax system or new laws with major effects on revenue. Instead, it relies on expected growth in the economy, consumption, investment, inflation and other factors affecting activity. Despite the higher collection, the tax burden is projected to remain at 11.2% of GDP.