Tax Revenue Rise 38% in Argentina

February 4, 2014 Taxation in Argentina

BUENOS AIRES – Argentina has enjoyed a record-setting month for tax collections, but the positive results may be caused by unsustainable economic conditions.

The collection of tax revenues in Argentina reached ARS 90.3 billion this January, rising by 37.5 percent compared to the same months last year, according to a new statement issued on February 3rd by the national tax authority Administración Federal de Ingresos Públicos (AFIP).

The significant increase in the tax revenues was attributed to rises in the collection of VAT, personal and corporate income tax, social security contributions, and import duties, with boosts of 42.3 percent, 46.9 percent, 31.4 percent, and 43.7 percent, respectively.

According to the head of AFIP Ricardo Echegaray, the strong growth in the tax revenues collected was due to an expansion of the national economy, with particularly strong expansion seen in the manufacturing, real estate, and retail sectors.

The total of revenues collected in January is the highest monthly record in three years.

Despite the optimistic results, some economic experts have already pointed out that the increase in collection may not be a product of sustainable economic expansion, but may instead be caused by steep hikes in the prices of everyday consumer goods, which rose by as much as 30 percent over the course of last year.

Photo by: Esteban Maringolo