Tax collection increased 58.7% in October and accumulated 14 consecutive months above inflation

In October, tax resources increased 46%; those of Customs 86.3%; and those of Social Security 65%, compared to an inflation rate in the past 12 months of 52.5 percent (AFIP)

The tax resources of the AFIP in October exceeded one billion pesos ($ 1,018,783 million), 58.7% more than a year before and its growth resulted from a higher rate than inflation, which reached 52.5% in that period, according to data provided by the Presidency of the Nation. The collection is nourished by what is received through the DGI (taxes); Customs (withholdings on exports and duties on imports, mainly); and Social Security (Contributions and Contributions).

“The collection in October was thus for the fourteenth consecutive time above the price increases. The real improvement is around 5%. Compared to October 2019, collection also shows an increase greater than that of the price increase”, They explained from the Government. If inflation is taken with a lag of one month, for a period of more than 20 days to enter taxes, the real rise is reduced to 4 percent.

“During the first 10 months of the year, the collection also grew above the price increase. In the nominal register, tax revenues increased more than 65% between January and October”To $ 8.79 billion, mentioned the Executive Power. It meant an increase of 13.3% in real terms.

In the first 10 months of 2021, tax resources rose 13.3% in real terms

Once again, the contribution of income generated by Argentine foreign trade (111.4% increase), contributed to this sector of the economy remaining as one of the pillars of tax collection and the reduction of the deficit fiscal by the Central Administration, despite the uncertainty generated by an exchange market with various alternative prices for financial transactions, and the regulatory changes that a Central Bank has in place, concerned about the loss of foreign exchange reserves.

The Chamber of the Oil Industry of the Argentine Republic (Ciara) and the Cereal Exporters Center (CEC), entities that represent 48% of Argentine exports, announced that During October, companies in the sector settled USD 2,417 million, a historic mark for this century in the tenth month of the year, and 40.8% higher than that registered 12 months earlier. “The predominant factor was the sustained growth in international prices, which offset the lower quantity measured in tons. This performance was achieved despite the notable disruptions caused by the downspout of the Paraná River ”.

Foreign trade remained one of the pillars of tax collection and the reduction of the fiscal deficit

Likewise, Ciara-CEC recalls that “the settlement of foreign exchange is fundamentally related to the purchase of grains that will later be exported, either in their same state or as processed products, after an industrial transformation. Most of the foreign exchange inflow in this sector occurs well in advance of export, anticipation that is around 30 days in the case of the sale of grains abroad and reaches up to 90 days in the case of protein oils and flours ”.

Exports of grains and oilseeds remained high despite the notable disruptions caused by the downspout of the Paraná River
Exports of grains and oilseeds remained high despite the notable disruptions caused by the downspout of the Paraná River

This anticipation also depends on the timing of the season and the grain in question, so there are no delays in the settlement of foreign currency, beyond the “noise” generated by an exchange market dominated by uncertainty and the increasing regulations that are being implemented. They have both exports and imports of inputs, many of which are necessary for the production of goods for subsequent sale to the rest of the world.

In this regard, the AFIP reported that Since November, the changes introduced by the General Customs Directorate (DGA) have been in force to optimize the operation of the platform that facilitates exports to entrepreneurs and small and medium-sized companies., mainly aimed at simplifying processes, while “enhancing the inspection and customs control of foreign trade operations.”

“The collection associated with Social Security significantly accelerated compared to the previous month and its contribution to the growth of national collection increased for the second consecutive month. Largely, the momentum is driven by the recovery of wages after the different joint agreements”, Considered the Ministry of Economy. But the effect of payment of the payment facility plans implemented in the first months of the onset of the health crisis, which is manifested in the gap of 10 percentage points between the increase in personal contributions, 58.9%, and employer contributions, 68.5 percent.

“In this way, the October collection exceeded the values ​​recorded during the 2016-2020 period, placing the accumulated resources at the tenth month of the year at levels higher than those of the pre-pandemic. This trend will make it possible to continue with policies that boost activity and employment, while guaranteeing the * sustainability of public accounts ”, they concluded.

Highlights the analysis of the Economy technicians that in the month “It does not include what is received from non-tax income from payment facilities associated with the Solidarity and Extraordinary Contribution (Law 27,605), which amounted to $ 4,268 million.” Since May, the total entered into the public coffers for this concept amounted to $ 245,457 million.

Signs of increasing informality

The clear reactivation of the economy, although not exempt from volatility due to the appearance of sources of shortage of imported inputs necessary for various industries, not only manufacturing industries, but also for agriculture and even construction and trade in final goods, product Due to the increasing regulations on the exchange market, it also remains another of the pillars of tax collection, with seven consecutive months of year-on-year increase in the Monthly Estimator of Economic Activity from Indec, and private measurements.

The clear reactivation of the economy also continues as a pillar of the increase in collection, although there are signs of greater activity in the black

Nevertheless, For the sixth consecutive month, there is a growing negative gap between the real rate of year-on-year increase in total AFIP income -adjusted for inflation- with that corresponding to the recovery of GDP in a similar section.

According to private sector economists, part of this negative difference is explained by financial difficulties in various companies and businesses that it would be leading them to incur arrears in the payment of tax obligations, but mainly because with some exceptions, such as foreign trade and construction, no minor role in the recovery of economic activity corresponds to the unregistered sectors, which were the most affected by the health crisis during the previous year.

Hence, despite the outstanding performance of tax resources in the last 14 months, although still compared to previous very low levels due to the effects of the health crisis, they are still not sufficient to generate the cash that the Treasury needs to be able to cope to debt maturities, in particular with the IMF, with whom the Government is in full negotiations in Europe.

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Reference-www.infobae.com

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