The decision to withdraw the funding chapter of the omnibus law complicates the goal of achieving zero deficit this year. A recession will occur in 2024, which will negatively impact revenue collection.
Minister of Economy, Luis Caputo gives up 1.4% of GDP to resources He said he plans to end the gross deficit of the national public sector this year, according to the adjustment plan he presented a month ago. Strictly speaking, it is a A very optimistic estimate Before the decision to remove from Omnipotent law tax chapter.
From the private sector, it is believed that the government is not in a position to fulfill its promise to the IMF to achieve a 2 point GDP surplus with the now withdrawn fiscal plan. . Some market analysts don't think so 0.8 points can be achieved very confidently. More pessimists believe it could be between 0 and half a point.
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There are many elements that come into play. The first is that Minister Caputo cannot prevent recession this year. This will affect tax collection. Cohen estimates that Argentina's economist Martin Polo is a loss of resources. 1 point of GDP. But the original estimate was a total of 5 points short and actually was In 2023 it was 6 points.
In turn A withholding of 1 point has a corresponding increase in collection Due to last year's lost export recovery. A recent report by Argentina's Agro-Industrial Council (CAA) estimates a loss of US$19 billion in exports in 2023, which will be recovered in 2024.
On that side, the sum is equal to zero. therefore, Caputo wants to raise as much as he can with another revenue increase. One of them The extension of PAIS duty to all imports is expected to add 0.8 points to GDP for this. It doesn't need to go through Congress.
In the opposite sense, It has already waived more or less half a point of the additional withholding expected to be levied on all exports.. It had already agreed to withdraw from 30 regional economies, but its application to the industry remained intact.
For compilation Personal assets, shifting profits and moratoriums are estimated to gain another half a point. Of these, the most substantial are profits. The Prohibition, and money laundering in particular, depends on public acceptance. Probably the Minister added a less optimistic estimate to these calculations.
that way, Without reducing pension costs included in the plan by 0.4 percentage points, the loss of resources would be 1.4% of GDP.. If the article repealing the renewal formula hitherto in force is removed from the Omnibus Act, Pension costs will continue to expand as before. Because the formula conspires against the fall Takes past inflation into account. Therefore, if the evolution of prices tends to slow down in the coming months, pension costs will increase in real terms.
