During the last months of this year, the national government, with the impetus of Sergio Massa, modified the income tax and exempted more than 800,000 workers and retirees from payment.
Through the decree 473/2023, the then minister of Economy ordered to raise the floor of the non-taxable minimum at 1.7 million pesos per month, equivalent to 15 minimum vital and mobile salaries (SMVM). The measure began to take effect in October and will end at the end of the month.
A reform with the support of Milei
weeks later The modification of the law was discussed and approved in Congress which made it possible to eliminate the fourth category of the tax and, in parallel, a new schedule tax replacing the previous one, which fixes the payment of the minimum taxable also in 15 SMVM. Due to the reform, only 90,000 people would have to pay the tax.
The bill passed in September had the support of the main labor confederations and, at the same time, received the positive vote of the current president Javier Milei, at that time national deputy.
The reform should come into effect on January 1, as stipulated in the approved law. At the current value, The floor to pay the tax would be $2,340,000. However, since the government of Freedom Advances They announced that they will seek to reverse the changes.
Currently, as stipulated by the DNU, employees with gross salaries greater than the $1,980,000. It is the equivalent of SMVM of October multiplied by 15. As of January, when the law comes into effect, workers and retirees would be exempt and only those who receive salaries and wages would pay it. $2,340,000.
Who would be affected if Profits are reversed?
However, the initial approach of current government would imply going back with the changes – instead of enacting a new law – so the calculations that were in effect until September would be maintained, prior to publication of the DNU.
If confirmed, the variables that calculate the non-taxable minimum would once again be affected by the index Average Taxable Remuneration of Stable Workers (Ripte)which was the one used prior to the decree and the new law, and which defines the monthly readjustment of the tax.
Thus, if the current value is updated at the beginning of 2023 based on the evolution of the RIPTE, Those workers and retirees who receive income would pay the tax again. monthly income of approximately $974,467.
Taking into account that until September the Earnings payment threshold was around $800,000 and that after the publication of the DNU they stopped paying close to $800,000 800,000 people, the reversal of the reform would imply that they would pay again the tax those who benefited until today.
How much do they expect to raise with the reversal of Profits
Last night, after Luis’s announcement of measures Caputo, the Ministry of Economy released a graph that contemplates the cuts and pruning that will be applied on the public spending to achieve fiscal balance: reduction of pensions, pruning transfers to provinces, adjustment in social programs and, in addition, the reversal of the reform of Profits.
According to the calculation of the ministry that leads Caputo, the retraction of the increase in the minimum taxable amount would generate a increase in collection of 0.4% of GDP. To do this, they must send a bill to Congress.
Source: Ambito
