THE “SUPER VAT” IS VIABLE IN ALL PROVINCES

The success in lowering inflation increases the urgency for reforms that contribute to improving competitiveness. One of these is a “Super VAT” that absorbs provincial and municipal sales taxes. It is a viable and beneficial scheme for all provinces, even those with lower levels of development or reduced tax base.         (more…)

THE GOVERNMENT’S ECONOMIC PLAN NEEDS THE MAY ACT

At the request of the governors, the national government established the Council responsible for implementing the May Act. Structural reforms are essential for the economic plan. Among the most urgent is the elimination of provincial and municipal sales taxes to be replaced by the “Super VAT”.         (more…)

GARRAHAN HOSPITAL SHOULD STOP DEPENDING ON NATIONAL GOVERNMENT

The labor dispute at Garrahan Hospital is a source of controversy. There will be no definitive solution as long as it remains dependent on the national government. To preserve its excellence, it is essential to give doctors ownership of the hospital so that they can guarantee good salaries through good management.        

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1 OUT OF 4 AGRI-DOLLARS GO ABROAD OR TO “UNDER THE MATTRESS”

The proliferation of controls did not prevent Argentines from seeking to protect their savings by sending them abroad or to the mattress. Reversing this State’s sterile persecutory attitude is a necessary first step for those savings to have a better destiny. Also necessary is to improve controls over criminals.        

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ELECTRONICS CONTRIBUTES 0.1% TO EMPLOYMENT, BUT 17% IN TIERRA DEL FUEGO

The decision to lower tariffs on the import of cell phones and household appliances benefits millions of consumers. It has a low impact on total employment, but is very high in Tierra del Fuego. To facilitate its implementation, it is essential to have a reconversion strategy involving the Nation and the province.       

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“SUPER-VAT” TO ELIMINATE PROVINCIAL AND MUNICIPAL SALES TAXES

The exchange rate appreciation set the urgency to address the severe competitiveness problems suffered by domestic production. An essential step is to go forward with a tax reform eliminating the provincial and municipal sales tax. The best way to do it is to absorb both taxes with a “super-VAT”.         (more…)

INFLATION KILLED THE SERVICES PROMISES TO DISABLED PEOPLE

Disability assistance operates under a complex set of rules that promise many benefits without contemplating how to finance them. The adjustment occurs by updating the price list of benefits below inflation. The main consequence is that many disabled people are left without coverage.   (more…)

REAL WAGES FELL BY 25% IN THE LAST DECADE

In the context of productive stagnation, high inflation caused a strong reduction in real wages, which allowed maintaining the level of employment. In the new scenario of stability, if no progress is made with economic structural reforms, the adjustment will inevitably affect the level of employment.      (more…)

IMPROVING COMPETITIVENESS WITHOUT REDUCING TAXES

The exchange rate’s proximity to the band’s floor reduces its inflationary impact but maintains competitiveness problems. Since it is very difficult to lower taxes without affecting the fiscal balance, the solution is to replace taxes that erode competitiveness with taxes that do not.        

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MORE IMPORTANT THAN THE EXCHANGE RATE BAND IS THE MAY ACT

Exchange rate easing is a sensible response to currency appreciation. It is likely to have a negative, but controlled, impact on the disinflation process and recovery of production and incomes. Nevertheless, the weakest aspect of the announcements is the scant references to the structural reforms of the May Act.        

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