After preventing the mayors who collect municipal taxes through the invoices of public service companies, now the Minister of Economy, Luis Caputowill go for the second option that the municipal leaders of the province of Buenos Aires have to raise money.
This is what is known as Health and Safety Tax (TISH) and the Road TaxIt is worth clarifying that, strictly speaking, by technical definition these are not rates but taxes.
The difference is that the first works as a price for a consideration and the second is an obligation to pay the State based on the person’s ability to contribute. Constitutionally, municipalities in Argentina can only charge fees.
The problem is now known because a municipality in the metropolitan area announced that it will charge supermarkets in the district a 6% rate for Safety and Hygiene, which is calculated based on the turnover of the business. But this situation has been going on for some years.
In 2021 the Supreme Court of the province of Buenos Aires ruled in favor of the municipality of Quilmes, against an oil company for two service stations it had in the district. The company had challenged the tax, but the court argued that it was not unconstitutional for the municipality to use the company’s billing to determine the value of the tax.
This year the charging a rate on the value of fuel which is sold at service stations located in the communes, known as Road Tax.
Now Caputo will go against the mayors againwarning that they will try to keep part of the revenue that the Nation will give up in its policy of lowering taxes.
The minister said in a statementdo it by streaming He had a discussion with officials on his team that the municipal leaders “will not be able to collect their taxes on electricity or gas bills.” “This is a first step that is very important because they were hiding the increases there,” he explained.
“But also There are others who are going for more, like the mayor of Lanús raising taxes on supermarkets, the same in Pilar…”, he said.
In that sense, he said: “People should understand that in order to collect a rate has to have a consideration and for the rate to go up it has toto have additional compensation that is not there.”
In this regard, the Minister of Economy anticipated: “We are looking at how to solve this problem because it is suffered by the common citizen.”
The statements of the head of the Treasury Palace They anticipate a new political conflict between the Casa Rosada and, above all, the Province of Buenos Aires. There, not only does the mayor of Lanús apply the same criteria authorized by the superior court of Buenos Aires, but also mayors of the PRO, like the one from Tres de Febrero, Diego Valenzuela, collect “taxes”.
What legal tools would the national government have at its disposal?
As explained by the Tax lawyer Diego Fraga In this area, the national government could question municipal taxes based on what is established in Article 9 of the Co-participation Law. He himself states that by adhering to co-participation lThe provinces, autonomous bodies and municipalities of the same undertake not to apply taxes or rates “similar to national ones” that are shared.
For this the Nation should file a filing with the Federal Tax Commissionwhich regulates the fiscal relationship with the provinces, and make a proposal to retain part of the co-participation in the event of obtaining a favorable opinion.
Fraga explained, however, that sIt is a procedure that takes time and that would not meet the needs of the Executive Branch, which seeks to rapidly reduce global tax pressure to stimulate investment.
Similarly, the national government could carry out a new claim of unconstitutionality through a public company with a branch in the province of Buenos Aires, to the point of trying to take the case to the national court, but that procedure could take a decade, given the time frame in which justice is handled.
But, Fraga commented that there are some federal courts that are giving rise to claims. ”There are some rulings that are beginning to recognize the possibility of federal justice intervention, although this had been aborted some time ago by the Supreme Court. If they start to move towards federal justice, they could start issuing injunctions against the municipalities,” the lawyer explained.
What is the tax burden on municipalities?
According to estimates by the Argentine Institute of Fiscal Analysis (IARAF), in 2023 National tax collection accounted for 22.8% of GDP that year. Provincial taxes accounted for 6.73% of GDP, while The tax burden of the municipalities reaches just over 1.14% of GDP.
Its head, Nadín Argañaraz, indicated that “beyond whether or not the Court authorizes them, they are gaining a lot of importance” which increases what he described as their “distorting nature.”
Source: Ambito
