The Government highlighted a drop in prices due to the flexibility of imports: the benefited sectors

He Ministry of Deregulation and State Transformationby the economist Federico Sturzenegger, The Institute for International Trade (INDEC) released a report highlighting that after the elimination of SIRA, consumer prices of goods exposed to international trade showed an increase below the Consumer Price Index measured by INDEC.

According to the ministry, “While the general inflation between December 2023 and July 2024 was 98.5%, the price increase in clothing, household goods, recreation and household appliances was 53.2%, 42.1%, 46.8% and 25.8%, respectively.”

Deregulation: prices of imported products have been reduced due to the elimination of SIRA

The SIRA was eliminated in December 2023, with the aim of “streamlining the import process.” Later, the Government adopted similar measures along those lines, such as the elimination of registration in the Importation System. Financial Economic Capacity (CEF)of the Affidavit of Product Composition (DJCP) and the flexibility of the “regulatory red channel” of customs, eliminating the obligation for certain products to pass through said channel.

The ministry led by Sturzenegger stressed that “after the repeal of SIRA, promoted during the administration of Javier Milei In December 2023, a drop in the prices of clothing, linens, recreational products and household appliances, relative to the CPI, is observed.”

In addition, they indicated that “The observed effects on prices are due to the elimination of SIRA and not to other factors” since sectors not exposed to foreign trade, such as insurance, health insurance and recreational services, “did not register falls in their relative prices after December 2023.”

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PAIS Tax: a drop in prices is expected after the rate reduction

In parallel, last week The Minister of Economy, Luis Caputoconfirmed that This Monday, September 2, the Government will lower the PAIS tax from 17.5% to 7.5%. In this regard, he predicted on Wednesday that he expects a decrease in inflation due to the drop in the COUNTRY TAX.

“I think that it will imply a reduction in prices in September,” he said. He also said that he met with many cameras to convey this to them.

“Yes, on Monday the rate will go down from what we had raised at the time from 7.5% to 17.5%, which we raised at the time and I said it would be temporary, that it would be to gain negotiating power in a situation in which we wanted to pass the Bases law and so on,” he said in radio statements.

According to some city analysts, in terms of inflation, The reduction of this tax could be positive if it generates a decrease in the prices of imported goods.. However, It is expected that this impact will only be seen from September onwards.