BUENOS AIRES – The Argentine government sent to Congress this Tuesday a public emergency bill that would boost taxes on personal assets and the purchase of dollars, while freezing the price of public services to provide a little relief for the more vulnerable sectors of society.
This project is the first package of legislative measures to be promoted by Argentina’s new president, the Peronist Alberto Fernandez, in order to deal with the crisis afflicting the country with high inflation levels, currency depreciation and soaring national debt, all part of the fallout from a recession that began in April 2018 and has driven poverty and unemployment to emergency levels.
Economy Minister Martin Guzman discussed in a press conference at the Ministry of the Treasury in Buenos Aires the broad outlines of the proposed law of social solidarity and productive reactivation, together with its role in resolving the current emergency, which he considers “the first step toward resolving the economic and social crisis besetting Argentina.”
“We all understand how difficult the current situation is and how the problems of poverty, joblessness, food security and hunger have grown,” Guzman said.
In that sense, he added that the bill includes “a series of measures that seek to keep things on an even keel and protect the more vulnerable sectors,” while restoring the macroeconomic conditions so necessary for resolving all the problems of the Argentine economy.”
The economy here has been in recession since April 2018, with high indices of inflation, close to 40 percent of the population immersed in poverty, and with unemployment rising as the peso falls in value.
The bill was introduced into Congress for its first debate in committee and possibly on Thursday in a full Chamber of Deputies session.
The minister announced a series of measures contained in the bill that would suspend the system for updating pensions in order to replace it, within a period of 180 days, with a more “consistent” formula.
Guzman announced that retirees who receive a minimum pension will receive in December and January separate bonuses of 5,000 pesos (about $80 at the official rate of exchange).
The economy minister said he expected a series of tax measures to be passed, including the reinstatement of the 2015 tax quotas on personal assets while taxing financial holdings abroad, at the same time that income tax on savings in pesos will be eliminated.
A 30-percent tax will also be imposed on the purchase of foreign currencies, 70 percent of which will be used to finance social security and 30 percent invested in infrastructure and housing.