Economists discuss the impact that government measures can have on the regime of Tierra del Fuego. Employment, prices and geopolitical issue are other discussion spotlights.
This week the Government announced a reduction of internal taxes and tariffs that pay electronic products, mostly assembled in the province of Tierra del Fuego. This would imply one Fall in the collection of the National State, although there are analysts that warn a couple of mechanisms that could partially compensate for this negative effect.
Within the framework of his electoral campaign as a candidate for Buenos Aires legislator, Manuel Adorni used his role as a presidential spokesman this week to inform the Elimination of cell phones import tariffs, reduction in internal tax for cell phones, televisions and imported air conditioners, from 19% to 9.5% and the eradication of said tax for electronic products manufactured on the island itself.
The main objective of this measure, according to official communication, is to benefit consumers through lower prices. As a counterpart, the treasure would lose income.
What impact can the decline of tariffs on fiscal matters have?
In fiscal matters, Juan Carlos Findoco-author of a series of documents on the regime of Tierra del Fuego to found, said that The lower collection could be remedy Even if it is partly, by two ways: the first, For the replacement of domestic production for imports, which are going to pay VAT, and the second for the replacement of purchases abroad with local production that, because they have better prices, could boost the activity and income tied to it.
Regarding internal tax drop, the Conicet researcher and specialist in international economy, said it is a “transfer of income from the treasure (between US $ 200 million YU $ 250 million) towards consumers, who will pay lower prices.” “The Fueguina electronic industry benefits from this, since When inducing lower prices, purchases abroad are replaced by local purchases. This substitution would attenuate the fiscal cost of the measure by inducing more retail and local distribution, which pay taxes“He deepened.
As for the removal of cell tariffs, he warned that he could affect the local industry, although tax exemptions (mainly in VAT) still give margin to compete. “To the extent that production is replaced in Tierra del Fuego by imports, VAT collection will rise for 21% of the imported amount (versus 0% that pays the imported kit that is assembled locally). That is the main mechanism that would reduce the fiscal cost of the regime, “he said.
Leonardo Parkanother of the co-authors of the Documents of Fundar, estimated that, with the new measures, the price gap between national and imported cell phones could lower the current 24% to 8%. “There are reasons to think that production will continue but with strong import pressure”project.
Source: Ambito
