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Argentina's Taxman Clamps Down On Grain Exporters

by Mike Godfrey, Tax-News.com, Washington

17 October 2012


The Argentinian tax authority, AFIP, has struck at two companies accused of tax irregularities, possibly exposing them to higher tax rates on their export operations.

The agency said Monsanto is being pursued for taxes worth USD70m outstanding from 2001-2005, and is also being investigated for the underpayment of property taxes. Bunge meanwhile is said to owe USD93m from 2006-07.

In a statement, Monsanto said that in its 56 year history of operating in Argentina, the company "has never evaded taxes". Monsanto is currently seeking clarification of the issue from the tax authority.

The announcement from AFIP comes as part of efforts to tackle tax avoidance and evasion among the nation's largest companies. In previous years, AFIP pursued a handful of major exporters for triangulating trades through other nations and using illegitimate accounting ploys to cut taxable profits.

AFIP has however been accused of heavy-handedness, especially in the case of gas company YPF, which was prevented from exporting gas after failing to pay a minor tax bill of USD8m in February. YPF, formally a Spanish company, was nationalized by the government this year. Also at this time, AFIP revealed that it would pursue payment from 300 tax debtors engaged in cross-border trade.

In recent days, AFIP has confirmed the initiation of investigations into the tax affairs of agricultural commodities giant, Cargill; into Barrick, the world's largest gold extraction company; and into a Chinese-state-owned conglomerate, Minera Sierra Grande SA.

TAGS: tax | tax avoidance | law | accounting | enforcement | food | tax authority | trade | Argentina

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