The CAC expressed concern about the impact of increases in IIBB rates

The Argentine Chamber of Commerce and Services (CAC) questioned on Wednesday the increases in the income tax rates. Gross registered in several provinces after the fiscal consensus signed by the Government. Despite highlighting the support for changes promoted by the Executive, the Chamber warned of the impact on the commercial sector of the increases envisaged.

In a statement, they welcomed the Fiscal Consensus signed by the National Government and the provinces at the end of last year to establish a gradual reduction of said tax with the objective of alleviating the tax burden. However, they pointed out that "contrary to the spirit of the agreement, various jurisdictions that had some sectors below the maximum agreed for 2018 (or for which no cap was set for this year), chose to apply increases, compensating the losses in other activities, which ended in an increase, in real terms, of the pressure that this tax generates (the average inter-annual variation of the collection of this tax was 32.7% in the first two months of 2018, in some cases this variation reached more than 50%). "

In that sense, they remarked that the commercial sector " was, once again, one of the big losers ".

As the report highlights, "twelve provinces applied some kind of increase over the sector that is one of those that does not have a maximum rate expected for 2018." They emphasize that the increases occurred in the Autonomous City of Buenos Aires, between Rivers, Jujuy, La Pampa, La Rioja, Misiones, Neuquén, Río Negro, Salta, Santa Fe, Tierra del Fuego and Tucumán, "being treated in some cases of general tax increases, while in others there were increases applied to certain levels of billing, typically to larger establishments. "

From the CAC they reiterated" the general support for the transformation process initiated by the Government ", but they argued that the drop in tax pressure in some sectors "does not result in an increase in the burden on others."

Finally, they put the focus on that "the way to compensate for the reduction of tax resources should be the reduction of informality, which in addition to involving a large loss of fiscal resources, means unfair competition for formally established companies that they comply with their tax, labor, and all other obligations, beyond the necessary reduction of the expenditures of an oversized State. "