The payment of December salaries in January creates an uncertain scenario in relation to Income Tax.
The DNU and the Omnibus Law, which include countless economic reforms, did not incorporate the reversal of the Income Tax. What is the reason? Last September, during the administration of Sergio Massa, the minimum monthly income from which the monthly income is paid had been raised.to the fourth category of Profits, which exempted more than 800,000 taxpayers from paying the tax.
It should be remembered that the fiscal cost of the measure is $2.9 billion and of that total, $1.7 billion is what corresponds to the provinces, as calculated by the governors.
The reversal of the norm, whose modification had counted on the affirmative vote of Javier Milei himself when he was a deputy, is in line with the Government’s premise of reaching fiscal balance in 2024: eliminating the modifications would contribute 0.4% of GDP to the National Treasury according to calculations published by the Treasury Palace. However, the main drawback is linked more to the political than the economic.
Earnings: Do they pay December salaries or not?
Payment of December salaries in January creates an uncertain scenario in relation to Income Tax. The current regulations pose some ambiguity in their application. According to these regulations, January salaries could be covered by the legal protection granted by law 27,725, as long as they do not exceed 15 Minimum Living and Mobile Wages.
Law 27,725 had established an improvement in the Income Tax, but a possible reversal of this measure, which It didn’t appear in the draft, could reinstall the text prior to this law. The former draft of the regulations stipulates the validity of the measure “from the year 2024”, which could imply that salaries paid in the first days of January are governed by law 27,725.
However, the uncertainty lies in the possible reversal of this law, since, Being an exercise tax, it could affect everything settled up to that point. If the law is repealed, employees could find themselves in the situation of reimbursing part of their salary due to the retroactive tax generated.. This uncertain scenario could divide the year 2024 into two tax periods, generating complexities in tax settlement.
In summary, the employer who pays the December salary in the first days of January 2024 could apply the current law until the rule is repealed, which could mean that salaries would not be affected by Income Tax if they do not exceed 15 Minimum Living and Mobile Wages. However, the potential reversal of the law creates uncertainty and complexities in the tax situation for employees.
Source: Ambito
