The 5 bil in Vz bonds are worth less and less (of course the Rufie lied):
Chavez Causes Jitters With New Taxes
By CHRISTOPHER TOOTHAKER Associated Press Writer
© 2007 The Associated Press
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CARACAS, Venezuela — Investors sold off shares in Venezuela's main telephone company on Monday and some Venezuelans fretted about President Hugo Chavez's plans to impose new taxes on luxury items from second homes to expensive cars.
Chavez said Sunday that shareholders in CA Nacional Telefonos de Venezuela, or CANTV, will not be compensated at market value when the company is nationalized and also said that his government will soon hit the rich with new taxes.
CANTV's American Depositary Receipts sank 17 percent on the New York Stock Exchange, ending Monday at US$11.22 (euro8.67). The Caracas Stock Exchange also fell, closing the day down 7.7 percent. Locally traded CANTV stocks closed the day falling by 10.7 percent.
CANTV is controlled by New York-based Verizon Communications Inc., which holds the largest minority share. Verizon's shares, however, did not react to the news and finished the day unchanged at US$37.25 (euro28.84).
Chavez said Sunday that the government's price paid to CANTV shareholders would take into account debts to workers, pensions and other obligations, including a "technological debt" to the state.
"I'll pay when the law dictates and in the form the government decides," he said. "I'm going to tell them that CANTV was given away, and that they shouldn't come here saying it must be paid for at the international price," he said. CANTV was privatized in 1991.
Chavez said the takeover should proceed swiftly.
Many upper- and middle-class Venezuelans, meanwhile, were focused on his calls for new taxes.
Manuel Perez, a 45-year-old shopkeeper, drives a Toyota sport-utility vehicle that could fall under the new luxury tax, and he fears Chavez could use proceeds to help finance generous projects in allied leftist countries like Bolivia.
"I don't want to be paying to help other governments like that of (President) Evo Morales," he said.
Chavez, who now effectively controls all branches of government in Venezuela, will soon begin changing laws by decree under special powers that are expected to be granted by the National Assembly this week. Among his plans are moves to nationalize CANTV and the electrical sector.
Chavez says rights to private property will be respected, though opponents argue Venezuela is headed for Cuban-style communism.
Chavez said the new taxes _ the rates of which remain unclear _ are aimed at those with "lavish property," such as a yacht, a luxury car, a second home or art collections.
Bernardo Iguini, who runs an art gallery in Caracas' upscale Altamira district, said he expects to lose thousands of dollars (euros) a month because buyers will have doubts about investing in paintings or sculptures.
Chavez said revenue from the tax would go to communal councils, neighborhood groups that form the backbone of his Bolivarian Revolution _ named after South American independence hero Simon Bolivar.
Opposition politician William Ojeda said those most affected by the tax would be the so-called "Boli-bourgeois," nouveau riche Chavez allies who have become wealthy, allegedly through cronyism.
"If he wants to get tough on the rich, he should start with his own people," Ojeda said.
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