On June 22, formal employees in Argentina can “celebrate” the “Tax Independence” Daywhich means that the period of the year dedicated entirely to cover the payment of taxes corresponding to 2025. From that day, they will have their income to meet their own demands.
This calculation is carried out every year Argentine Fiscal Analysis Institute (Iaraf) and offers a perspective on the incidence of the tax burden on family income.
According to the work, The calculation of the formal tax burden for different profiles of salaried families in Argentina reveals that the “Tax Independence Day” is between June 22 and July 1, depending on the level of income considered.
This concept represents The moment of the year in which a worker has allocated the equivalent of his working time to cover the total of the tax burden on his entry, consumption and heritage. In Argentina, the three levels of government – national, provincial and municipal – apply 155 different taxes, according to the report.
Tax payment: Type Family Profiles
Iaraf’s study was based on four profiles of type families, composed of four members (marriage with two children), with monthly gross income that vary as follows:
- Case 1 $ 1,550,000
- Case 2 $ 380,000
- Case 3 $ 4,950,000
- Case 4 $ 7,100,000
The most important taxes of the three levels of government were consideredboth direct (such as personal contributions, employer contributions, income tax, personal goods) and indirect (VAT, gross income, municipal fees), assuming that the tax burden moves fully to the wage earner.
He “Total income” of a worker was defined in the analysis of the IARAF as the Gross salary plus employer contributionswhich represents the total labor cost that an employer is willing to erogate. It is then estimated that the average comprehensive formal tax burden for the four cases of salaried families analyzed is of the order of 50% of the total income.
This means that In 2025, an Argentine formal wage worker must allocate between 173 and 182 days a year to comply with the total of their tax obligations to the three levels of government: national, provincial and municipal.
The results of the tax charge for the four income profiles reflect a comprehensive tax burden that is between 47.3% and 49.9% of the total income, that is, it presents a low dispersion, despite the fact that the maximum level of income is equivalent to 4.6 times the minimum income.
Taxes: the tax burden is regressive
The report shows the existence of a RECORD IN THE TAX CHARGE. Indeed, cases 2 and 3 of income, which have a total income by 118% and 219% higher than case 1, respectively, have a load between 1.5 and 2 lower percentage points. For its part, case 4, with a salary 360% higher than that of case 1, has a tax load only 0.6 percentage points higher.
Given this behavior of the formal tax burden for each of the four cases of income considered, “it is essential to identify the main factors of the regressiveness that is evidenced,” says the Iaraf. One of them arises from personal contributions. Case 1 has 7.4 more percentage points of tax load than case 4, since it has a contribution of 13.7% of the total income, while the fourth case has one of 6.3%.
The other relevant explanatory factor is the typical return of indirect taxes. In relation to case 1, case 2 has a lower 1.9 percentage points, case 3 one of 2.7 percentage points lower and case 4 one of 3.8 lower percentage points.
Source: Ambito
