In Argentina the private sector must face 96 taxes

43% of the food, 58% of the cars, 50% of the homes and 55% of the gasoline prices are composed by taxes.

INFOBAE – In moments in which the national government sharpens the pencil to cut the level of public spending and balance the fiscal deficit, other arguments arise about the disorders of the Argentine economy as, for example, the weight of the State on the private sector.

The businessman and economist Gustavo Lazzari addressed the problem in an article published this Monday in El Economista. Based on his experience as a businessman and the analysis of public data, he pointed out that 96 taxes weigh on the backs of the private sector.

If to that number we add the new tax on financial income – its regulation is still in process – and the tax that the Buenos Aires government began to charge for circulating in the downtown area, the list would rise to 98.

Acronyms such as ARBA, ARCIBA, AGIP, AFIP, SICORE, CM05, F931, ART, SISCREB, TIR and VAN -among others- are common for executives in their work tables. Each month they must face 19 deadlines in 22 working days – as long as there is no extra-long weekend that limits the period of execution of the tax charges.

“When you enter the factory, and the first thing you ask is what tax is due for the day, it becomes difficult to produce. Every day you have a tax to pay, not taking into account the check tax and other taxes you have everywhere. It worries me because the beauty of a factory is when you think about what to produce, how to do it better or how to recover a client that a competitor took you. It’s much nicer than thinking about SICORE or ARCIBA”, analyzed Lazzari.

All these taxes fall on the backs of 8 million private taxpayers, who finance the 20 million people who receive some type of social plan. 15 years ago, the account was balanced by 7 million on each side.

On the direct tax burden facing the small business units, we must add a tangle of regulatory issues that are still hidden tax burdens for the employer. By way of example, Lazzari – owner of a slaughterhouse – said that to transport a bondiola (Pork meat cut very popular in Argentina) he has 22 procedures and to produce a chicken he must make 164.

“I’ve had cases that asphalt pirates have stolen my trucks and the person who handled it clung to the procedure folder rather than the truck because the vehicle is recovered, the merchandise is lost, but the procedures are a month of work for the carriers”, he said.

That cluster of commercial, civil and labor regulations that add costs to the activity end up discouraging investment and the creation of jobs.

To this, we must add that in many cases small companies are transformed into an agent for collecting and withholding taxes that are transferred directly to the treasury. Therefore, many times an invoice from a Small or Medium Enterprise includes more items of charges, that are not his own, that of the services that he really provides to the final consumer.

The historical saga is forceful. Today the tax pressure on the Gross Domestic Product reaches 37 percent. In the 1980s it did not reach 20% and in the 90 it was 25%.

Gustavo Lazzari is a contributor to the Libertad y Progreso Foundation.
Published in Infobae.