Earnings: who pays and why it is intended that only 10% of workers be taxed

With the approval at the beginning of 2021 of a wage “floor” where workers in a dependency relationship and retirees must pay Earnings, the intent was that the tax would reach only 10% of workers and a small sector of retirees, the higher. revenues. Y the minimum amount of the non -taxable minimum has not been changed in that way those who earn across the “floor” will continue to contribute as much as they do until that moment.

Initially the floor wage was set at $ 150,000. Between that amount and $ 173,000, a measure was approved to avoid sudden “jumps” in the tax measure.

On the “floor” application, of the 2.3 million retirees and workers who paid Earnings in 2020, it was reduced to approximately 950,000, “returns to the historic percentage of only 10% of those with higher incomes paying income”according to the foundations of the initiative.

Both the “floor” and the MNI and other deductions is updated once a year. But the law approving the “floor” gave the Executive Branch the power to raise it during the year in such a way that the 10% range would remain constant and would not increase as a result of inflation and salary adjustments.

So, after a few months, it was corrected salary “floor” and raised it to $ 175,000 always so that they contributed with an income not exceeding 10%.

2022 began with a new non-taxable minimum-it is updated once a year due to the evolution of RIPTE- and the “floor” has been raised to $ 225,937.

Now it turns out that due to inflation, parity adjustments and wage increase for those “out of contract” the workers reached by Earnings have again exceeded 10% of the total.

So also the head of the Deputies, Sergio Massa asked the Minister of Economy, Martín Guzmán that the Government exercise the assigned powers and raise the salary “floor” where workers in a dependency relationship pay income tax.

The argument is that the current “floor” of $ 225,937 is left and workers exempt from paying income began to have discounts for this tax.

For fiscal year 2022, the salary “floor” rose from $ 175,000 to $ 225,937, up 29.1% when salary projections exceeded 50%, with minimal parity with 60% adjustments and review clauses before the end of the year.

In a letter sent to Guzmán, Massa recalled that Executive Power was empowered to raise the “floor” of Revenues if more workers would be re -affected by that tax – as is happening – in relation to the 10% set as the ceiling .

Union sources assert that the current “floor” of Revenues of $ 225,937 is set for 2022 with the Project Budget reaching 33% inflation. And considering the current economic variables altered by higher inflation — especially the 60%parity — the number of taxpayers who will pay taxes will increase monthly and will be even higher. larger than those who contributed in 2021: approximately 1.3 million, 36% more than the original projection.

In that plan, Increasing the “floor” to $ 265,000 per month will allow the balance to be maintained so that only the same number of workers and retirees will pay taxes as expected in the 2022 budget.pointed out by these resources.

In the case of retirees and pensioners in 2021, the non-taxable minimum has been raised from 6 to 8 minimum wages, which are automatically updated every 3 months by the mobility formula. With the lowest credit since June at $ 37,525, MNI jumped for retirees and retirees to $ 300,196, which is higher than the amount proposed for workers in a dependency relationship.