Draconian new monetary controls from Wednesday

  • From Wednesday 17th September the 35% tax (deductable) which the previous Kirchner government introduced prior to 2015 is being reintroduced.

    This is on top of the 30% country tax (impuesto pais) that we are already paying. So if, for example you're paying AR$100 for Netflix or other services/outside purchases in US$, that figure will now be AR$165, with the 35% tax being claimable on your tax return, unlike the 30%, which isn't refunded.

    This also means that whatever US$ purchases you make will be put against your allowance for the measly US$200 per month and then deducted, thus reducing people's ability to save in dollars.

    Further, companies with large debts in US$ will be badly affected because they can now only acquire 40% of the US$ that they need and those exporting also because they will be paid/exchanged at the official rate.

    It doesn't get any better I'm afraid.

    I forgot that VAT (IVA) is charged on outside purchases in US$ as well, so add that to the pot.

  • It's not supposed to be helpful, that's the point. No monetary control is helpful, but the government maintains that the black market is mainly used for illegal purposes such as drugs and money laundering and their new measures effectively bring the official dollar in line with the black market rate.

    Black market dollar today is now at $145. That's the result.

    I expect Guzman will resign as economy minister because the central bank has gone way over his head.

  • Kirchnerism is denial at its finest. It remembers me of the (good?) ol' days of Berlusconi. Around the world, everybody was making fun of Italians and of Berlusconi. Italians living abroad were alerting Italians in Italy of how Berlusconi's political move were read by key opinion leaders abroad, what the newspapers abroad wrote about him and his politics. (This was even before the sex scandals)

    However, Mr. B.'s crew and supporters were labeling as envious critics the rest of the world, who still weren't unable to grasp the greatness and innovativeness of Mr. B's politics.

    With Peronism and Kirchnerism it is the same thing. They are doing what nobody else in the world has done/does (except Cuba, Venezuela, and some exotic African countries, which are doing SO GREAT, by the way!) thinking that they are beating everybody else with their breakthrough political and economical moves, instead of recognizing that nobody is doing those because they S-U-C-K. And worse, they produce the opposite effect the Peronists and Kirchnerists claim they want to achieve.

    Anything that a prominent economist or journalist abroad says on Argentina, is labeled as merely envious outsider who cannot grasp the greatness and innovativeness of their politics.

    Yeah, exactly...

  • Yes, anyone who criticises government policy is labelled as a golpista or anarchist. Populism at its finest.

  • They want to discourage saving in dollars when the peso is practically worthless yet historically, everyone in this country with access to USD has always fallen back on them for security.

    Everyone I know has been buying dollars with every available peso that come their way, even if they have had to buy at $140. That says a lot.

    Central Bank tightens currency controls as peso weakens

  • They want to discourage saving in dollars when the peso is practically worthless yet historically, everyone in this country with access to USD has always fallen back on them for security.

    Maybe in the bags of Lazaro Baez there is enough USD bills to provide some relief. Not to mention in the caveau of Cristina & Family.

    I bet that also the Moyanos have a considerable stack of USD somewhere...

  • This how the taxes apply when buying anything for say, US$10 - software, Netflix etc

    US$10 xAR$79 = AR$790

    +21% = AR$955.9

    +30% and 35% (65%) = AR$1577.23

    This effectively doubles the price.

    Certain services such as Netflix will charge in AR$, so these taxes wouldn't apply.