After introducing modifications to gain votes, the new “omnibus law” drafted by the Government of Javier Milei will imply that mining and hydrocarbons are the two export complexes with the lowest withholding rates.
This is because articles 169 and 170 establish that all merchandise that has not had withholdings or has had, but below 15%, will be subject to 15% export duties. Sectors that have already been taxed with withholdings higher than 15% will maintain them, according to article 172.
Meanwhile, article 173 establishes: “Maintain the rate of export duties that were in force as of December 31, 2023 for hydrocarbons and mining. The National Executive Branch will identify the tariff positions of the Mercosur Common Nomenclature included in this article.”
Thus, the withholdings for these two sectors will remain: hydrocarbons at 8%, gold and silver at 8% and the rest of mining at 4.5%, with lithium being the main export mineral.
With this wording for mining and hydrocarbons, the new “omnibus law” does not modify the original text. At some point the Government had the idea of increasing export duties on oil to compensate for the decline in other sectors (such as wine, which fell from 8% to 0%), but in the end no progress was made. The mining companies opposed the increase by arguing that they should have fiscal stability due to the mining investment law.
Where they look very closely at this article is in the copper sector. Currently, there is no active project in Argentina, but according to the Ministry of Mining, northwest Argentina has one of the largest metal reserves in the world (12th place worldwide). There are 13 projects that are in stages from advanced exploration to construction. A single project could involve investments of over US$4 billion, as announced by Lundin Mining for the Josemaría project in San Juan. As the current scheme is maintained, companies will be able to choose whether to pay withholdings of 4.5% or adhere to a sliding scheme that goes from 0% to 8% depending on the international price of the mineral.