[ad_1]
The Argentine Congress signed into law a extraordinary tax applied to large fortunes, with the intention of finance the fight against Covid-19 and approve poverty subsidies and loans to small and medium-sized companies, among other urgent social aid.
The new law is estimated to reach 12,000 people. Argentina, the third largest economy in Latin America, is entering its third year of recession, with high inflation and a sharp increase in poverty.
The bill was approved by the Senate by 42 votes to 26. The session was broadcast live on YouTube this Friday (4).
The pro-government alliance affirmed its majority to approve the so-called “solidarity contribution”, which will attempt to raise the equivalent of about $ 3 billion.
The law is vigorously rejected by the largest opposition force, the neoliberals Together for Change, former President Mauricio Macri, according to which it is a confiscation measure. The most influential employer, Associação Empresarial Argentina (AEA), declared that “it affects private property and represents a blow to investment, production and employment, as well as causing great discontent.”
It is estimated that the contribution, popularly called “tax on millionaires”, will reach between 9 thousand and 12 thousand people, in a country with 40.9% of its 44 million inhabitants are in poverty and have an unemployment rate of over 10%.
Argentina has yet to overcome the recession, which has lasted since 2018 and was exacerbated by the pandemic.
The single mandatory contribution will tax people whose declared assets exceed 200 million pesos ($ 2.35 million), with a progressive rate of up to 3.5% for assets in Argentina and up to 5.25% for assets outside the country.
“There is fiscal space to tax those who have the most, for the first time in history, with a direct tax. This is not only the case in Argentina. The regional tax system is tremendously unequal,” said Adrián Falco, secretary of the Network. of Tax Justice of America. Latin America and the Caribbean.
“The system is based on consumption taxes, never on those with more. Those who actually pay taxes are very few. Tax havens and shell companies are used to escape taxes, ”said Falco.
Near 20% of the proceeds will be used for medical supplies for emergency care due to the pandemic., another 20% for small and medium-sized companies, 15% for social development programs, 20% for scholarships and 25% for natural gas development programs.
“The tax reaches 0.8% of taxpayers. Of these, 42% have dollarized assets, of which 92% abroad. It is far from taxing productive activity”, declared the government legislator Carlos Heller, one of the authors of the project.
On the contrary, the president of the Argentine Rural Society (SRA), Daniel Pelegrina, warned that “they want to present it as a contribution of the richest, but we know what happens with all these unique taxes. They stay forever.”
Hernán Letcher, director of the Center for Economic Policy Studies (Cepa), pointed out that “the proposal is not exclusive to Argentina. There are at least 11 countries in Europe and Latin America that are moving towards greater tax justice. These income support measures and household subsidies aim to reduce inequality. ”
