The lack of legal certainty (seguridad juridica) is the root of Argentina's woes

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    Asking an accountant for a summary on a financial issue is always a mistake because they can never give you a short answer. But since Adri is a chartered accountant, I asked her about the financial mess, anyway.

    Her opinion is that, due to the lack of legal certainty (seguridad juridica) in this country, with laws being changed on the fly, sometimes every single day, depending on which way the wind is blowing, things will not change and Argentina will always be stuck in this mess.

    Take one example - the wealth tax.

    In 2016, then president Macri brought in the money amnesty (blanqueo) where people were persuaded to declare their assets, much of which were abroad. But in the end it was a honey trap, being told that the taxes would be as follows, bearing in mind that in 2015 the taxes were 0.50 to 1.25%:

    • 2016 0.75%
    • 2017 0.50%
    • 2018 0.25%
    • 2019 a promise to bring the tax to zero.

    Then the elections came around and Massa persuaded Macri not to put that tax at zero, but to reinstate it at 0.25 to 0.75% in exchange for Massa bringing all his votes to Macri at the election. But in the end, Massa stabbed Macri in the back and went with his votes with team FF, but the change had already become law.

    Now the new team FF is proposing the wealth tax at anything up to 1.25% and double that for accounts held abroad.

    That's just one example shifting goalposts and legal uncertainty.


    As for the official rate, she reckons it's held artificially low because businesses couldn't manage the real rate and would probably go out of business. So in a way, they are being subsidised.

    The farmers? When they sell their soy beans they sell in USD, receive the official rate and they can only be paid in pesos, thus requiring them to buy USD at the higher rate on the black market.

    Is it really fair to export and invoice in USD and receive toilet paper in return?


    If laws are not written in stone, but are changed constantly on the fly, legal certainty becomes a mockery and a pipe dream.

    hahaha, u r just making my point with the farmers......

    So perverted!!!!!

    The farmers are the ones paying this whole fiesta!!!!!!


    And btw, way back in time, there was another usd rate, the one used for farmers.......even lower than the fake official......and usd would be converted to that, retention taken and pesos paid out!!!!! At the end they would have a third left if they wanted to buy the original dollars back!!!!!!

    I think she's got it just about right.


    The result of having to 'play safe' can be seen in every area of business here with the inevitable outcome...spiralling inflation....which caused it in the first place. It's a never-ending circle.

    This is the problem of this communism.......nobody is allowed to do well and create wealth......then they are bad!!!!! Basically the landowners and agro sector is to blame for Argentinas problems......such bollocks! I'm glad I'm not a agro producer, I would go ballistic!!!!!

    Argentina need to go around with those backbones of the whole economy a little more respectful!!!!! Imagine if the big producers just say one day, "enough is enough, I think I quit this business and start another business on my land" ! I couldn't care a damn about how rich they are, since they are actually the only ones keeping this country together and feeding the whole population.....the game Alberto playing is a dangerous game!!!!!