Javier Milei was ready to start enjoying the benefits of being taxed in the recent legislative elections. But I couldn’t celebrate. At the start of its new conformation, the Argentine Chamber of Deputies approved in the early hours of July the presumption project for 2026 presented by the ultra-Derechist government. His proposal, which now must be considered by the Senate, did not gain sufficient support to maintain cuts in funding for public universities and attention to people with disabilities, their great commitment to travel.
The alleged debate, which lasted more than 12 hours, was the first since Milei took power: until now, the president had chosen not to negotiate with the opposing parties, which is why he had governed without presuppositions, the force of decrees to allocate and adjust resources. The decision to hold the debate this time is partly determined by the change in the balance of legislative forces: in October, La Libertad Avanza – Milei’s party – won with 40% of the votes in the mid-term elections and reached the first parliamentary minority. It also affects the demands for consensus building and institutional strength demanded by the International Monetary Fund (IMF) and by the government of Donald Trump, the benefactors who saved Milei’s economic plan last April and September.
Milei’s hypothesis projects total spending of 148 billion pesos (about $100 billion), with a GDP increase of 5% for 2026 and annual inflation of 10.1%. The government’s optimistic estimates contrast with the inflation rate accumulated this year (27.9%) and with the growth projections proposed by private consultants (hoping for an expansion of 3.2% of GDP this year).
The allocation of resources desired by the Government implies the continuity of the fiscal adjustment and reduction of the State applied since last year. For example, in the field of education and culture, it establishes a real amount of resources of 1% compared to 2025 and almost 48% compared to 2023.
“This hypothesis is the basis for advancing the reforms that Argentina needs,” defended the initiative of MP Juliana Santillán, of La Libertad Avanza (LLA), at the start of the debate. “We limit ourselves so as not to spend more than what happens, eliminating monetary emissions and thus guaranteeing greater predictability,” said, in the same sense, Diego Hartfield, also from LLA.
For the opposition, however, “this hypothesis is not simply an exercise in budgetary austerity, but rather a political decision to abandon the education, healing and care jobs that support social inequalities in Argentina”, as Maximiliano Ferraro, of the centrist Civic Coalition, warned. Myriam Bregman, from the Izquierda Front, stressed that the project “attacks the sectors: women and culture”. Agustín Rossi, from the Kirchnerist bench, questioned the official proposal because “it lacks a look at the real economy. It is impossible to continue to govern with weapons around the reality of Argentines”, he said.
Ultimately, in the general vote, Milei’s hypothesis received 132 votes for, 97 against and 19 abstentions. The conservative PRO party, founded by former president Mauricio Macri (2015-2019), was the main ally of the LLA, which also received support from dissident sectors of Peronism and other centrist and provincial forces.
What I have not been able to do is get the government to provide the necessary support to override laws approved this year by opposition agencies, which were vetoed by the President and which were ratified by Congress by special majorities. These are university funding and emergency care laws for people with disabilities, passed with the aim of reversing the effects of the presidential motorcycle. The Executive has never applied them and now, within the framework of the presuppositions project, it aspires to their elimination.
Despite tense negotiations that stretched to a middle ground, with promises of additional funds for several provinces, minutes before the vote, the chapter of the project that included the two exemptions was rejected with 123 votes to 117. The opposition celebrated with shouts and applause in the room.
After dealing with this hypothesis, the Chamber of Deputies continued to debate other laws proposed by the Government: the law of national commitment for fiscal stability – which prohibits the deficit of public accounts and monetary issuance without support – and a reform of the criminal tax regime – to allow the laundering of funds, raising the thresholds from which people and companies can be investigated for tax evasion. The debate will continue in the Senate and the Executive hopes that its initiatives will be transformed into law before the end of the year.
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