“Recovering the average salary in Argentina is a challenge that we must take at this time of economic recovery. That is why I want to ask this esteemed legislature to speed up the treatment of the law that facilitates Reducing income tax on wagesWith this phrase in the opening speech of the regular sessions of Congress, President Alberto Fernandez It passed a tag on this item in the pending list of the Argentine tax system.
“If we do so, more than 1,200,000 Argentines will be released from paying this honor. Workers and retirees will benefit from it, and thus their purchasing power will be restored,” the president said. Report from Avellaneda National University Analyzing the impact on people and collecting the increase in the non-taxable threshold raised by the project ensures that this is a decision “It would improve the consumption capabilities of a segment of the population that is not among the 10 percent earning the largest income“.
The report estimates that between 2003 and 2015 an average of 12.5% of the total number of public and private sector workers reached by the tax was recorded. Between 2016 and 2019, the average increased to 21 percent: from 1.2 million at the end of 2015 to 2.3 million at the end of 2019.
Earnings in Massa
The Profit Adjustment Project He was promoted by Sergio Massa in the House of Representatives. Last February, the head of that authority proposed increasing the non-taxable threshold for paying the tax.
So far, those paying this tribute have been unmarried employees who have no children with a net monthly salary of 75,000 pesos; And families who charge 99,000 pesos. And retirees and retirees who are on a salary of six minimum wages.
With this adjustment, the net salary that will reach the employee will be 124,500 pesos. In the case of retirees, the minimum wage will increase from six to eight (it will pass 114,000 to 152,000 pesos per month).
Undav’s report shows the statistics that contribute to disproving a narrative built by business with the dominant media outlets Inflate the tax pressure in the country.
In international comparison, the Income tax collection accounts for about 5 percent of Argentina’s GDP Below the index for other countries such as Spain (7.9% of GDP), France (9.6% of GDP), the United States (10.1% of GDP) and Australia (11.8% of GDP).
On the one hand Property tax (personal assets), Argentina ranks last in the group ranking As a percentage of GDP is 0.2 percent while Australia, France, Great Britain, the United States, Germany, Japan and Chile are above 1 percent.
A progressive tax system
In 2020, the country suffered a decline in its total revenue due to the epidemic and the consequent decline in economic activity. The economic recovery in recent months has been matched by the continuous increase in national tax collection.
In terms of the monthly development of income tax collection, 22 out of 37 months recorded real negative changes between years. However, total tax collection registers worse dynamics in this sense, accumulating 25 months of decline over the past 37 months. “The crisis that arose between 2018 and 2019 was accompanied by a return to the International Monetary Fund (IMF) and in line with and as a result, the impact of reduced activity on tax collection in the country.”
“The Reducing the scope of income tax would require a financial effort of nearly 40,000 million pesos That would stop collecting it with a progressive tax. For this reason, a future increase in the personal property tax could be viewed as a progressive tax that collects well below the global average of wealth taxes, “the report concludes.