Tax collection in 2019 amounted to $5,02 trillion, with a growth of 48,5% compared to what the treasury obtained in 2018, below the inflation estimates that are located at 53% for last year, reported this Friday (03.01.2020) the Federal Administration of Public Revenues (AFIP).
In a statement, the agency said that this result was obtained after December closed with revenues of 492.366 billion pesos, with an interannual growth of 53,9%.
AFIP reported that last year tax revenues "experienced a fall in real terms; tax revenues were affected by the economic recession and the deterioration in labor market indicators."
The effects of the lower dynamism in the level of activity are observed in the Value Added Tax (VAT), which only grew 38,7%, and the Income Tax, which rose 47,8%, below inflation.
Meanwhile, income linked to the Social Security System increased by 33,9%, "reflecting the negative impact of the economic downturn on employment and wages."
On the other hand, export duties grew well above average due to the increase in the tax rate, the largest amount exported, especially of soybeans that in 2018 were affected by the drought, and by the rise in the dollar.
Added to this is the decision by companies in recent months to make advance statements to avoid the increase in "withholdings" announced by President Alberto Fernández in mid-December.
For all these reasons, "export duties" grew by 248,9% to total $398.000 billion.
Import duties, on the other hand, rose only 52% to $163.000 billion, due to lower quantities purchased abroad.
The tax structure is concentrated in three taxes: VAT, Income Tax and Social Security, which together account for 75,7% of the year's revenue.
When export duties and the tax on bank debits and credits are incorporated into the analysis, it is found that $9 out of every 10% of annual tax revenue was contributed through these five taxes.
In this context, VAT reached $1,5 billion, with an increase of 38,7%.
The VAT, linked to the domestic market, grew by 42,9% while the Customs VAT increased by 33,5%.
The negative impact that the reduction in the level of activity had on tax collection was compounded by a series of tax policy decisions in 2019 that reduced tax revenues from this concept.
In the case of the Income Tax, the accumulated revenue collected last year from this tax was close to $1,1 billion, which represented a growth of 47,8% compared to the previous year.
Throughout 2019, the collection of this tax was affected by the decrease in the corporate tax rate, as well as the increase in the non-taxable minimum and the reduction in advances to individuals arranged in August of last year.
Aduana News is the first Argentine customs newspaper to launch its digital version. With 20 years of experience, its publications and initiatives aim to provide the most relevant knowledge on customs issues in order to contribute to safe trade in the region.
