Due to the sharp decline in foreign exchange settlement and the reduction of importsthe harvest grew at a slower pace in January. Revenues were $2.2 trillion, implying a 93.4% year over year increase, well below expected inflation. Even though January data is released on February 14, economists expect the CPI to show a change of around 98%.
The result for the first month of 2023 shows a slowdown compared to December, when revenues rose 95.6% to $2.3 trillion, driven by the soybean dollar. Net of this contribution, the Ministry of the Economy highlighted that the collection in January was “driven by the trend of taxes linked to the internal market and the social security system”.
VAT has increased by 103%, an item that represents more than a third of the growth in collection compared to 2022, VAT on Receivables and Payables has grown by 97.4% and Participatory Tax by 94.5%. On the other hand, the PAIS tax, the 30% increase that applies to consumption in dollars and also to savings dollars, rebounded, rising by 105.3%.
The personal property tax increased 325.6%, the largest increase of all, following the additional 25% levy since October on dollar spends on cards over $300. And the income tax is up 97.7% for extraordinary expenses the advance of profits made by companies and the perception applied to the purchase of foreign currency in the month of July.
Pension resources, meanwhile, increased by 105.4%, accelerating for the sixth consecutive month, which the authorities attributed to the recovery in wages and employment. The increase reflects the growth in employer contributions (108.9%) and the increase in personal contributions (101.4%).
Taxes on foreign trade, on the other hand, recorded a change of 19.3%, showing a marked slowdown compared to December. Import duties and the statistical tax jointly grew 58.8% and export withholdings fell 4.4% in a month that was the worst in agricultural currency regulation since 2006.
“It is worth noting that the inter-year variation in export duty collection in January was influenced by the drought experienced in recent months, which had a significant impact on corn and wheat production,” Economía said.
For analysts, the collection data showed a start with a “real decline”. “Without inflation there would be a real decline of 2.2%”, stressed the Argentine Institute of Fiscal Analysis (IARAF). “Collections are a key factor in assessing the effective financing capacity of public spending. Sustaining positive real growth throughout the year will be a major challenge,” he added.
Source: Clarin
