Argentina cuts average wage tax to offset high inflation

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Argentina announced this Friday (27) a reduction in the tax on average salaries to adapt it to salary readjustments that took place this year in line with the high inflation that plagues the country and could exceed 60% this year.

The measure, demanded by unions, raised doubts in the government because it implies lower tax collection at a time when the country must undergo a review of an agreement with the International Monetary Fund for the restructuring of a debt of US$ 44 billion.

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During the announcement, Economy Minister Martín Guzmán said that 1.2 million workers will no longer pay the tax compared to 2019.

“The entire scheme of economic policies that we carry out is a scheme that transforms realities (…) so that Argentina continues on the path of recovery and improvement of the collection capacity”, added the official.

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The change in the Income Tax will exempt employees who earn up to 280,792 pesos per month (US$ 2,348, at the official exchange rate), who in the last year had salary readjustments in line with inflation and, therefore, paid a higher tax, despite having equal or even lower purchasing power.

Source: CNN Brasil

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