The decision of the Minister of Economic Affairs Luis Caputo, Pushing for a reduction in withholding taxes for the next agricultural campaign was met with relief in the countryside, but it will give a yellow light to the fiscal roadmap and its commitments to agriculture International Monetary Fund (IMF).
Private reports indicate that the fiscal cost of the measure is between 550 and 700 million US dollars by 2026. LCG estimated that the victim will be $687 million, a number that corresponds to exactly 0.10% of gross domestic product (GDP).
This amount representsThe entire fiscal “cushion” that the executive branch had planned for next year. When designing the economic plan for 2026, Caputo’s team allowed itself to relax the primary surplus target by 0.1 points compared to this year (target 1.5%). With the announced reduction in export tariffs, this scope for relief has already been allocated to the agricultural sector.
Lower retentions: contradiction to the budget
The measure also reveals a contradiction to the official plan. The announcement directly conflicts with the numbers reflected in the draft Budget 2026, which the executive branch itself sent to Congress.
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The economic team provides for the survey in the text of the law Export tariffs would rise, rising from 0.95% to 0.98% of GDP. However, the administrative decision goes in the opposite direction and lowers the rates instead of maintaining them. This forces us to recalculate revenue: either the government expects a boom in export volumes to offset the lower rate – an always dangerous bet on the climate – or it will have to cut spending in other items to make the numbers come close.
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The advisor balance It represented a slightly more conservative perspective, but was in the same spirit as the warning. You calculate direct costs (ceteris paribus, that is, holding everything else constant) of $550 million by 2026.
However, the company made an important caveat: This figure is a “gross” cost. The net impact on the treasury could be smaller when a positive cycle is activated. The official theory is that by improving the producer’s profitability, there will be greater investment in technology, more cultivated land and, eventually, a recovery in consumption in the country, which will improve the collection of other taxes (e.g. VAT or profits).
Oxygen for field tenants
In the meantime, the productive front breathes. The analysis of the agricultural figures shows that the measure prevents a decline in sowing. The key data is the “solvency” of the leasing contracts. For the first time this year, the equation for leasing a field is positive. }
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Before the announcement, the gap between what a producer could pay and what the field owner charged was negative (-$9/ha). With the reduction in retentions, this equation reverses and moves into positive territory (+10 USD/ha), Equilibra calculated. Specifically, this improves the producer’s solvency by 6% (from $317 to $336/ha) and allows the release of leases that were held back due to lack of profitability.
Relative winners and losers
Finally, the small print of the ad shows that the benefits are not equal. The 2 percentage point decline in soybeans (and their derivatives), wheat and barley is compared to the decline of just 1 point in corn, sorghum and sunflower. This changes relative margins and could shift the planting decision in favor of oilseeds over grains, changing the production map for 2026.
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