Until the publication of the regulations, accountant Sebastián Domínguez, CEO of SDC Tax Advisors, details some key points of the Tax package to be taken into account when liquidating the tax.
What is the amount of Income Tax?
In detail, almost one million workers will be affected by the tax, which will keep the threshold lowered to $1.8 million for singles, approximately $1.5 million net; and $2.2 million for people with two children, approximately $1.95 net.
From what salary do payments start?
Mandatory deductions (retirement, social security and law 19.032) that are made on wages are subject to limits that are defined monthly. By June 2024, The maximum taxable base is $2,265,033.81.
Employee – Gross Remuneration Net Remuneration
- Single: 1,800,000.00 – 1,494,000.00.
- Single with 2 children: 2,094,798.00 – 1,738,682.34.
- Married with 2 children: 2,366,333.00 – 1,981,277.25.
With the publication of the decree, the estimates of monthly earnings for single employees, single people with two children and married people with two children who only deduct mandatory contributions for retirement, social security and law 19,032 with the limit in force for the month of June 2024.
Repeal of the Cedular Tax on higher incomes with retroactive effect
The tax on higher income from employment, retirement and privileged pensions and others is repealed retroactively to January 1, 2024. This is possible since it is an annual fiscal period tax and the reform is carried out within the period 2024.
However, it is not reasonable for such a measure to generate a debt for employees who have already received their wages and given them a destination, especially in the current economic context.
To avoid this, the tax package includes a special deduction so that employees do not have to pay more taxes than they have paid since January 1, 2024 until the last day of the month immediately preceding the entry into force of the reform for the application of the tax.
With the publication in the Official Gazette, the special deduction will correspond to thes remuneration received between January 1, 2024 and June 30, 2024.
Improvements to personal deductions
There are no changes regarding the special deduction for certain retirees and pensioners, which remains at 8 guaranteed minimum wages.
The detail of the increases
On the other hand, a new deduction equivalent to one twelfth of the sum of the deductions for non-taxable income, family expenses and a special deduction for employees and retirees is incorporated. This deduction aims to provide an additional deduction for the Christmas bonus.
How are the scales updated?
The ranges of the current scales will increase by between 186% and 443%. The non-taxable minimum will be updated on a quarterly basis during this year, and then, starting in 2025, on a semi-annual basis based on the Consumer Price Index (CPI) prepared by INDEC for the calendar semester ending in the month immediately preceding the month of the update.
The Executive Branch is authorized to increase the scales for the fiscal period 2024 exclusively.
Elimination of special treatments
The new law eliminates special treatments so the bonus will be reachedas well as travel expenses, cash shortages or any type of income component that the unions managed to negotiate with the employers to reject the tax discount.
What happens with the debts generated?
In 2023, the Minister of Economy, Sergio Massa, increased the tax brackets. Employers stopped deducting from their employees, which is why this year the workers had generated a debt with the agency. The current law confirms what was done last year.
Source: Ambito
