Card dollar at $1,650 despite the end of the COUNTRY Tax?: what the Government evaluates in the face of a challenging summer

The rise in the price of Argentina in dollars, which promises to continue its course with the continuity of Luis Caputo’s “exchange table” and the devaluation of emerging currencies, ignited the alarms about the loss of foreign currency due to the tourist balance during the summer. Even more so in the face of end of the COUNTRY Taxwhich expires on December 22. With that scenario, In the Government, the idea that the card dollar should not become cheaper was finally imposed to try to minimize the impact of this drain on reserves. of the Central Bank. At this time, the economic team is evaluating alternatives to replace this tax with some other surcharge that compensates for its elimination.

In response to the query of Scopea high official source of the economic area explained that, at this moment, The decision that prevails is to prevent the card dollar from being reduced in nominal terms. “The idea is that, if you want to have access to BCRA dollars, they will not cost you less than in the market,” he added.

This Monday, The card or tourist dollar closed at $1,628 at Banco Nación. This is the retail price plus a 60% surcharge: 30% COUNTRY Tax and 30% withholding on Earnings, a scheme that governs the purchase of foreign currency intended to settle consumption in foreign currency and which is part of the framework of the exchange stocks. In just over 40 days, The portion corresponding to the COUNTRY will cease to exist. Thus, if the Government did not implement any measure to counteract it, this exchange rate would automatically be reduced by 18.75%. At today’s prices, it would drop to $1,322.75.

The decision will come from the Ministry of Economy. According to this media, What is being analyzed is some different tax mechanism to achieve the same goal: that the card dollar remains, at a considerable distance, above the MEP. Congressional approval would be required to include a new tax. Therefore, the most available option for officials is to decree a new perception as an advance on account of another tax that is already in effect, as is now the case with Profits. The basic premise is that this price does not go down in nominal terms.

If materialized a mechanism like that, which makes it possible to counteract the elimination of the PAIS Tax and maintain the total surcharge at 60%, The new scheme would debut with a dollar card above $1,650. The thing is that, for now, Luis Caputo and Santiago Bausili maintain the rate of depreciation of the official wholesale exchange rate at 2% per month, which is what sets the pattern that is then replicated by the different banks in the retail segment.

Days ago, Ámbito had anticipated that the Government was analyzing some measure based on the end of the PAIS Tax and that an official from the economic team said that the idea was “don’t give away the dollars”.

Dollar card and alerts for tourism abroad

Although this does not necessarily discourage the outflow of foreign currency from the country due to the tourism boom abroad. what is expected for this summer, does minimize the proportion of dollars coming out of reserves. With the MEP almost $500 cheaper than the card dollar, today the bulk of card expenses abroad end up being settled with own dollars purchased in the financial market. The Government’s idea is that this remains the case.

As this media reported, the projections for this summer break They are worrying. For example, economist Martín Kalos told Ámbito that his consulting firm, Epyca, estimates that More than US$3,000 million will be spent abroad due to expenses during that period.

It’s not a coincidence. The appreciation accumulated throughout the year, riding on the bet of Caputo and Javier Milei on the exchange anchor to contain inflation, led to the current situation is the most convenient for vacationing in Brazil (compared to doing it within Argentina) since 2001, according to calculations the economist Nery Persichini. This is attested to by the jump in queries that tourism platforms receive from sectors of the population that still have the ability to afford summer tourism. To travel to the United States, it is “the most attractive window since 2017.” “Bye Gesell. Hello Miami and Rio”Persichini summarized.

Argentina’s rising price in dollars is already reflected in other data. In October, the consumption of Argentines with cards abroad reached its highest level since 2018. This is clear from the BCRA information, which shows a jump in the stock of credit card loans in foreign currency that led it to close the month at US$646 million.

He Donald Trump’s victory in the United States added a additional pressure factor. If the devaluation experienced this year in several emerging countries was already significant (with Brazil as a paradigmatic case due to its relevance for Argentina), the arrival of the Republican threatens to enhance that process. The weakness shown in recent days by the real and other currencies in the region served as a sample of what could come.

The real multilateral exchange rate is already at its lowest level in the last 22 years, practically at the same level as the day before the megadevaluation at the beginning of Milei’s administration and only above a handful of months in 2015. If a continuation of the depreciation in Brazil, China and other important trading partners were combined with Caputo’s exchange rate anchor policy, Argentina’s rise in price compared to the rest of the countries would deepen.

Dollar card and appreciation

In dialogue with Scopethe financial analyst Christian Butler pointed out that the measure under study to counteract the expiration of the PAIS Tax reflects “a clear contradiction” in the official speech. “When you tell them that the dollar is late, they tell you no.”that today there is fiscal balance, that there is no issuance of pesos and that this changes the value of the real exchange rate. They give that argument. But they cannot eliminate the COUNTRY Tax from the card dollar without adding another tax. If the dollar were not late, there would not be a reason for there to be a differentiated card dollar.”held.

For Buteler, “the problem is that the exchange rate is artificially delayed,” due to the exchange rate table defined by the Government and the skein of regulations that make up the stocks. “This encourages trips abroad and discourages the arrival of foreign tourists, because Argentina is expensive.” Thus, he concluded that the implementation of a measure like the one prepared today by the economic team “It is nothing other than reinforcing the validity of the stocks in the face of the disappearance of the PAIS Tax.”