Technically, employees earning $173,834 should pay a 5% rate; those who receive between that figure and $347,669, 9%; and those that reach up to $521,503, 13%. But due to the effect of the increase in the special deduction increased by law, although they are reached, they will not pay.
Thus, the income tax floor for employees will go from the current $330,000 to $404,062 as of January 1st.. The government has not yet applied these changes, but it is estimated that the Ministry of Economy will do so in the coming days.
“When the remuneration or monthly gross salary is greater than $404,062 and up to the sum of $466,017, an amount will be able to be computed as an increased special deduction in accordance with the regulations issued by the Federal Administration of Public Revenues,” said Sebastián Domínguez. , from SDC Asesores Tributarios. Domínguez indicated that “when the remuneration or monthly gross salary is equal to or greater than $466,017, no additional special deduction will be applicable, generating significant damage.”
The specialist explained that, if the average monthly salary for 2023 exceeds $404,062, then next year’s bonus is fully taxed by income tax. On the other hand, if the aforementioned average does not exceed $404,062, then it will be exempt up to the amount of $202,031, that is, half.
Domínguez indicated that the 2023 Budget Law “authorized the Executive Power to increase the amount of the exempt bonus and the increased special deductions” applicable to employees in a dependency relationship. “In our opinion, this type of delegation is unconstitutional and it is the National Congress that has to make the modifications,” he said. The tax official stated that “The legislators have not taken into account the dimension of the implementation problems generated by the application of the increased special deductions for both employers, for the Federal Administration of Public Revenue itself as well as for professionals and companies that are dedicated to the settlement of salaries”.
According to data from the Ministry of Labor, the average salary of registered workers last October was $174,436.90, with an increase of 5% compared to September and 78.8% compared to a year ago.. In this period, inflation varied 6.3% month-on-month and 88% year-on-year. Namely, the average salary lost almost 10 points in one year. Even so, some wage earners will have to pay the tax.
Source: Ambito
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