In conversation with Channel Etributary Guillermo Butch He warned of the true scope of the tax reform project that the government intends to send to Congress, highlighting the political and technical challenges facing its implementation.
A tax cut that doesn’t change the bottom line
The specialist began by noting that at the moment “Everything is bypassed by the government“The real discussion will take place when the project enters Congress.”All tax regulations must be published within Congress and introduced by representatives.“, he noted.
He also clarified that the official proposal would include the abolition of about 20 taxes, although he clarified that “I don’t think it will be the taxes that will concentrate collections, such as the value-added tax, profits or check taxInstead, he held that executive power aims to “– Reducing the impact of income tax on individuals, by increasing deductions“.
but, Bush He warned that these deductions would require receipts and invoices: “Through documentation, the treasury becomes aware, because today every invoice is recordedHe noted that this measure could formalize part of the economy.
The challenge of the “super VAT” and federal engagement
One of the most controversial points, the so-called “Super VAT“It also raises suspicions.”If they want to do something similar to the value-added tax, they will first have to reform the federal tax-sharing law.“The tax man explained.
He pointed out that the aforementioned law prohibits the establishment of similar taxes by the governorates and that “Since the constitutional reform of 1994, a new standard was expected, but was never approved“So consider it.”“The value-added tax adjustment will be more complicated than the profits adjustment, because it requires the approval of all provinces.”
Asked about the possibilityTax competition“Among the jurisdictions,” Butch noted, “What is required behind competition is investments and development“This is a phenomenon – he said – that occurs between countries and within Argentina.
Cash tax and decline in collections
Regarding the idea of applying the tax on cash, the specialist said frankly: “A tax on cash will ultimately reward the informal sector“Many prefer to conduct transactions outside the system,” he said.People will say, “If you pay me cash, I’ll get to know you better,” then there will be money that leaves the system and doesn’t come back.“, to caution.
Regarding the decrease from 3.5% to 4% in collection, Bush He attributed the decline to the electoral context and economic uncertainty: “People were waiting and trying to protect capital. This slows the economy and generates less taxes.“.
Finally, Al-Rafid pointed out that “Consumption and production are the first variables to be recovered“To achieve continuous reactivation.
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