Coronavirus in Argentina: the wealth tax bill K is ready, but another proposal is circulating in Congress

05/12/2020 - 7:01

• Clarín.com
• Politics

Kirchner deputy Carlos Heller has already drawn up and is ready to be presented - he will be accompanied by the signatures of Máximo Kirchner and possibly the rest of the All Front caucus - the controversial bill that is subject to a new tax on large fortunes to meet health expenses in the face of the Coronavirus emergency. The decision is that the initiative formally enter table entries for the House of Representatives just achieved virtually sesionar for the first time in quarantine , which will probably happen this week.

Close to Heller they assure that the project is all drafted . But that every time he reviews it, the deputy makes a touch up . Now you have doubts with the same name of the initiative. Today it is: "Extraordinary Tribute to Mitigate the effects of the Covid-19 Pandemic". Perhaps instead of 'Tribute' it is "Extraordinary Contribution" , they count on the Kirchner bench.

In fine, the initiative sets an ascending tax of 2 to 3.5% to all Argentines who declared having more than 200 million pesos as of December 31. It is estimated that those affected would be around 12,000 people . Those who declared less than $ 200 million will be exempt from the new tax.

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The aliquot will go up scales. Those who have declared between 200 and 400 million must pay 2%. And it is increasing from half a point to $ 3,000 million. From there 3.5% will be taxed.

According to official estimates, they could raise between 3,500 and 4,000 million dollars , which at the official exchange rate would be more than 234,000 million pesos.

The intention, for now, of the ruling party is to give it a speedy treatment in Deputies. It must first be discussed in the Budget committee, which is chaired by Heller himself. Then in the compound. Although a special majority (129 deputies) is required for its approval because it is a tax with a specific allocation, in the Front of All bench they ensure that they have the necessary votes.

A "suggestion" circulates in Congress to make the new tax "more rational." The proposal is attributed in the government to the business sector. On the other hand, it is known that the UIA formed a committee to analyze the new tax and that it has sent its comments to the Government.

To avoid the eventuality that the new tax is blocked by some judicial protection, the alternative that circulates in a reserved way in the Congress is that the tribute be taken as "income tax credit".

"Allowing said credit not to prescribe and be adjusted for inflation, and may be applied to the payment of income tax for the maturity of sworn declarations from 2024, with an annual cap of 24% of the determined annual tax."

On the bench of the Frente de Todos de Diputados they claim to be unaware of this "suggestion". And they add: " It would be to change the spirit of the law. What we are proposing is an extraordinary contribution, not a tax advance."

Equally, they admit, the text could be modified in the event that Deputies receive "orders from above" .

In the business sector they assure that Alberto Fernández and that the Economy Minister Martín Guzmán are not enthusiastic about the initiative. "Guzmán privately describes it as' irritative '," they say on the employers' side.

Tributarists who have been consulted in recent weeks by businessmen consider that the initiative, in case of being sanctioned, will be blocked in Justice for being "unconstitutional for overlapping" with the Personal Property tax.

"80% of those affected will discuss the payment of the tax in court. The amparos will have suspensive effect and the discussion will not last less than 4 years in court," warns a taxpayer.

This expert also describes the tax as "confiscatory": he says that the one who has assets abroad is taxed 2.25% and with the new aliquot of 3.5% he would pay 5.75%. " It would be a confiscation that affects the right of private property," he adds.

In the government itself they know that if the law is approved the fight will be in Justice . "Everything is judicable, but which judge is going to oppose an extraordinary contribution to the fight against the pandemic?" They ask in the Front of All.

Deputy Carlos Heller.

They even imagine that in the event that the law is blocked in the first instance, the Court could intervene directly through a " per saltum" appeal filed by the Government. It is unknown, at the moment, if the Executive Branch is willing to play and if it is, it will do so thoroughly.