According to the numbers that Guzmán had prepared at the time, the revaluation mechanism can be applied without legal problems, since it is not related to an increase in taxes, but rather to changes in the way the taxable object is determined. The Government would thus maintain its maxim that the agreement with the body that conducts Kristalina Georgiev, it does not include any increase in existing taxes, or the creation of new ones; rather, it is a correction on the asset where the payment is calculated. Subtle difference, but, they affirmed in the Executive before the arrival of Massa, legally salvageable.
The agreement with the international financial organization signed last March 25, includes the following paragraph in the chapter where the promises of higher revenues as a result of the tax policy appear: “In close coordination with provincial governments, at the end of September we will complete the process of update of real estate revaluations at the federal level (structural reference) so that they begin to take effect as of fiscal year 2022. The net income from co-participation of this initiative could reach 0.1% of GDP for fiscal year 2022 and 0 0.2% additional GDP over the next few years”.
The final intention is to reach a total contribution of between 0.3 and 0.4% of GDP to reduce the deficit in this way, which would imply an approximate amount of $150,000 million. If we add to the revaluation what would be obtained from the reduction of energy subsidies projected by 0.6% of GDP; In total, the Palacio de Hacienda would reach total savings of more than the $600,000 million deficit; or, measured in another way, a 0.8/0.9% final imbalance for 2022 and 2023. For IMF technicians, this progress is essential to believe the Executive that the fiscal goal of a deficit of 2.5% this year and 1.9% in 2023.
The Fund wants an endorsement from the governors, who in general have already committed to increasing real estate pressure by having closed the fiscal pact at the end of 2021. However, there are few who at this point have seriously advanced in the application of the revaluation; and from what is known in the ruling party, many do not even have it in the folder. There is much less commitment in the Federal Capital. In fact, a few days ago, Horacio Rodríguez Larreta himself was publicly against the increased pressure of Personal Assets on real estate in Buenos Aires. From what is known, the IMF considers the revaluation incomplete if CABA does not join the commitment.
Source: Ambito
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