Argentina Has the World’s Weirdest Tax. Can Milei Scrap it?

[carride]

https://www.wsj.com/world/americas/argentina-export-tax-milei-economy-74f30747?st=gEoNva&reflink=article_copyURL_share

 

[FrankPintor]

I'd say the writers of the article have an agenda: to get the "retentions" on exports removed, which is why they disingenuously lump together all exports, both finished products and raw agro materials.

Creating finished products (or, at least adding value to raw materials) creates employment, and both workers and companies pay taxes.

A hugely mechanized agro industry exporting grain does not create employment, and would, unless otherwise required, pay almost zero taxes, despite using huge amounts of land, and public goods such as roads and waterways.

There are very few countries that export agro raw materials at the scale Argentina does, so there's not much to compare with, but, for example, other raw material extraction and export industries, like mining, get to pay royalties. I have no idea what retentions would be "fair", but between 10 and 30% doesn't sound bad.

 

[SlowWalker]

I'd say the writers of the article have an agenda: to get the "retentions" on exports removed, which is why they disingenuously lump together all exports, both finished products and raw agro materials.

Creating finished products (or, at least adding value to raw materials) creates employment, and both workers and companies pay taxes.

A hugely mechanized agro industry exporting grain does not create employment, and would, unless otherwise required, pay almost zero taxes, despite using huge amounts of land, and public goods such as roads and waterways.

There are very few countries that export agro raw materials at the scale Argentina does, so there's not much to compare with, but, for example, other raw material extraction and export industries, like mining, get to pay royalties. I have no idea what retentions would be "fair", but between 10 and 30% doesn't sound bad.

It does have jobs. If the quantity of export crops would not be consumed domestically, then 1) it would raise the cost of local consumption due to higher fixed cost as a percent of cost, 2) reduced labor, 3) reduced profits which invariably generate tax. Additionally, agriculture is able to ramp up relatively quickly compared to new mining, O&G projects etc.

Royalties on mining or petroleum are typically based on the idea that the resources is of limited supply, and therefore should maximize benefit for society and also be used to reinvest in society in education or other so that when the resource is no longer available the population has something else to earn from. Farming is renewable, maybe crop rotation but renewable nevertheless. Having an export tax effectively just raising the cost for farmers while not increasing price received since the price is determined globally.

Many countries are agriculture exporters, USA, Canada, Australia, Russia, Ukraine, Mexico, etc


Also because the market was previously closed in terms of importing parts etc, the farms in Argentina have incredible workshops and perform great maintenance and repairs in house, since they weren't able to easily upgrade and import parts, so I've been told.

 

[Ries]

the answer is- NO.
Milei does not have the votes.
Beyond the export taxes, the main sources of tax income to the govt here is taxes on workers, which is deducted from the paychecks of workers in blanco, and IVA.
while there is technically an income tax, less than 100,000 citizens qualify to pay it.
there is no real estate tax, no estate tax, none of the taxes that normally support governments in europe, or japan, or north america.
Japan, for example, has an IVA tax 1/2 the percentage of Argentinas, because it actually has a functioning tax system
Argentina's tax system is extremely regressive, and was designed to protect inherited wealth.
Many of the wealthy here have been wealthy families for 150 to 200 years.
The government changes, but who it benefits does not.

The USA gets 50% of its revenue from income taxes, and does not tax agricultural exports.

 

[toongeorges]

Argentina's tax system is extremely regressive, and was designed to protect inherited wealth.
Many of the wealthy here have been wealthy families for 150 to 200 years.
The government changes, but who it benefits does not.

The Argentine system is designed to keep wealth in black, because if you are officially rich, you pay wealth taxes (impuesto sobre los bienes personales) and capital gains taxes. Capital gains are seen as income and taxed that way. It is not a major source of income, because officially almost everyone is poor with a low income.

The USA gets 50% of its revenue from income taxes, and does not tax agricultural exports.

The USA also gets a 40% inheritance tax from every non US citizen investing in US stocks (or real estate), with an exemption up to 60000 USD. If you are not a US tax payer, you have to be careful to invest in the US. All is fine until you die.

 

[Ries]

The Argentine system is designed to keep wealth in black, because if you are officially rich, you pay wealth taxes (impuesto sobre los bienes personales) and capital gains taxes. Capital gains are seen as income and taxed that way. It is not a major source of income, because officially almost everyone is poor with a low income.




The USA also gets a 40% inheritance tax from every non US citizen investing in US stocks (or real estate), with an exemption up to 60000 USD. If you are not a US tax payer, you have to be careful to invest in the US. All is fine until you die.

Not sure how big a population there is of non resident non citizens in any country, but I dont think of that category of international investors as being more important than actual citizens, who, in the USA, are currently exempt from the first Fourteen Million dollars. The rich, both here and there, get the laws written the way they want.

 

[El_fuego]

argentine tax system is designed to be avoided. literally in the law it almost tells you how to avoid the tax. its like it only officially exists and if you're dumb enough to pay them, they'll take it

 

[Ries]

I find this report very informative-
as of 2025, personal and corporate income taxes are each around 8% of Argentine tax income.
VAT, and Import and Export taxes, together, are almost 60%.
Obviously basing your government on crippling your own economy by taxing exports as well as imports at such a high rate is extremely rare, and a thing that no more economicially successful country does...

https://www.oecd.org/content/dam/oecd/en/publications/reports/2025/05/revenue-statistics-in-latin-america-and-the-caribbean-2025-country-notes_29961c77/argentina_0adbf240/51fcb0ad-en.pdf