Due to money laundering, they estimate an improvement in November collection

Due to the contribution of the special tax of the bleach, the lower rate of contraction of the economy and the effect of Income Tax on salaries which was paid again this year, the Tax collection could have stopped falling in real terms in November.

The indications are given by automatic transfers and complementary laws that are intended for the provinces. In November they grew after 5 months of contraction, especially because the sum of the Income Tax and VAT were slightly positive, according to a report by the Argentine Institute of Fiscal Analysis (IARAF).

The information will be known this Monday when the Customs Collection and Control Agency (ARCA) publishes the final data.

“In the month of November 2024, the national government sent $4.2 billion to the consolidated provinces plus the City of Buenos Aires in the form of co-participation, special laws and compensation,” says the IARAF. The report He maintains that these numbers imply “a real year-on-year increase of 2%.”

For its part, the co-participationthat is, the automatic transfers less what was sent by complementary laws and compensations, there would be grew by 1.7% in real terms, improving their behavior compared to previous months.

“Given a very slight joint real interannual increase in VAT and Profits collection of 0.2%, the income obtained from laundering would have made it possible to increase the interannual variation of the net co-participation to 1.7%,” says the study.

This increase in net participation in November would be explained mainly by the good performance of income tax collection (+7% real year-on-year) that compensates for a poor performance in VAT collection (-4.1% real year-on-year).

Among other elements that play in favor of the collection of Income Tax is the low comparison base for 2023, because at that time the government ordered that employees stop paying it.

Another element that works in favor ofThe November numbers are that the 7.5% COUNTRY Tax is still being paid, which is the same rate that was paid last year. This year there was a greater normalization of the flow of payments abroad for imports and profits, in addition to higher income from withholdings on exports.

In October, tax collection had registered a slight drop of 2.4% in real terms, with still a partial impact of the special money laundering tax and the greater resources that the moratorium is providing. With this, if tax collection grew at the same rate as inflation (167% year-on-year), it would have reached approximately $12.5 trillion this month.

That is to say, it would have stopped falling. This year had an extraordinary positive month in May, due to the influence of the payment of company profits, that recorded strong accounting profits due to the December devaluation.

In fact, If the November collection had registered a decrease, this would be minimal, which indicates that by 2025 it is more than feasible that positive numbers will begin to be seen.due to the low comparison floor that 2024 will leave.

The consultant Politikon Chaco points out that the improvement in co-participation transfers “was mainly supported by the increase observed in the Income Tax (+7.1% in real terms) pushed by advances; and in the expansion of Other Co-Participants (+470.9% real) influenced by money laundering.” “On the contrary, VAT and Internal taxes showed decreases (-4.0% and -2.3% in real terms respectively),” says Politikón Chaco.

On the other hand, the consultant points out that the resources received by the provinces “derived from the Personal Property Tax, Social Security VAT and those from the Electric Energy Regime showed decreases (40.8%, 4.0% and 36 .2% real respectively)” while “those derived from the tax on Liquid Fuels and the Monotax had significant increases (211.6% and 95.2% in real terms respectively).”