Argentine Senate Agrees 2010 Budget

by Mike Godfrey, Tax-News.com, Washington

13 November 2009

The Argentine Senate has passed the 2010 budget alongside a raft of other measures including the extension of several taxes that will fund expenditure over the period.

Roberto Ríos Corrientes, head of the Budget and Finance Committee outlined the broad assumptions including GDP growth of around 2.5%, 8.2% investment growth, an increase of 8.4% in exports, and an increase of 6.4% in imports.

Total expenditure was set at ARS273.13bn (USD71.67bn), against revenues of ARS273.75bn, with an estimated surplus of ARS620m. It was stated that this year the provinces will have deficits in excess of ARS4bn. In 2003, total debt of the provinces came to ARS70bn or 18.8% of combined GDP, compared with ARS100bn in 2009 or 9% of GDP.

A number of tax extensions were agreed, including: income tax, minimum presumed income tax and property tax until December 2019; the emergency supplemental excise on cigarettes until December 2010; the banking turnover tax until December 2011; and the special contribution of cooperatives on capital, and simplified system or single tax until December 2013.

The lower house has voted to update the tax code for self-employed workers with a clampdown on tax evasion. The changes involve lower taxes but with greater sanctions and incentives for the self-employed to declare income and pay taxes. It will now be sent to the Senate.

A new legislature elected in June will take their seats on December 10, 2009 and the ruling Front for Victory will lose its working majority in both houses, although it will remain the largest single party in the Senate.

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