Although the Government ruled out a replacement for the PAIS tax, the trend of international tourism searches over domestic tourism is worrying.
The Minister of Economy, Luis Caputo, and the Secretary of Tourism, Daniel Scioli, are looking for alternatives to avoid the outflow of some US$2.7 billion, According to private calculations, what Argentina will suffer due to the trips of Argentines abroad.
The thing is that at the end of the year the PAIS tax ends, which taxes 15% of expenses made abroad with dollars through credit card, and they are looking for an alternative to replace that tax, between the political tensions that maintaining it would imply and the pressure from the International Monetary Fund (IMF) that fights for a single exchange rate.
“In September the Country Tax was lowered from 17.5% to 7.5% for the import of goods and the payment of freight, but it remained in the ‘card dollar’. But now it cannot be extended and alternatives must be studied to maintain it at those levels,” official sources confided to Noticias Argentina.
The impact of the card dollar on reserves
From the private sector, the Mediterranean Foundation explained that during the first half of the year Outbound tourism demanded US$3.9 billion, and the balance (net of income from inbound tourism) was negative by US$1.4 billion.
“From the examination of trends, it is possible to predict that in the year the demand for dollars from outbound tourism will approach US$7.5 billion and the balance could be around a net outflow of US$2.7 billion (with income from incoming tourism of around US$ 4.8 billion), according to preliminary estimates“, highlighted a document signed by economists Marcos Cohen Arazi and Vanessa Toselli.
In that sense, with a view to the elimination of the PAIS tax in 2025, which currently makes card transactions abroad more expensive by 17.5%, “taking into account that the greatest imbalance is usually located in the first quarter, and the expected path for the exchange rate that emerges from the monetary and exchange strategy, “The magnitude of the imbalance could increase, especially next summer,” warned the Mediterranean Foundation.
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The search for international tourism grows
An indicator that can anticipate these trends is the rate of internet searches associated with tourism options that Argentines usually choose.
In that sense, “Searches associated with outbound tourism grow at a rate of 54% year-on-year in September, while those of domestic tourism fall 15%, reflecting a renewed interest in tourism options outside the country, to the detriment of tourism in the country,” said the Mediterranean Foundation.
Source: Ambito
I am an author and journalist who has worked in the entertainment industry for over a decade. I currently work as a news editor at a major news website, and my focus is on covering the latest trends in entertainment. I also write occasional pieces for other outlets, and have authored two books about the entertainment industry.
