Javier Milei's government in Argentina is making significant progress on both tax and labor reforms, including a new tax innocence law that favors the majority of taxpayers.
In Argentina, president Javier Milei has made decisive strides in enforcing key elements of his government agenda within just one week. Two pivotal issues—tax reform and labor reform—are currently at the forefront, with the tax reform already in motion and the labor reform recently passed by the Senate. The labor reform will now proceed to the Chamber of Deputies for final approval.
The tax reform centers around a novel approach known as the Law of Tax Innocence, which shifts the presumption of guilt in tax matters, declaring taxpayers innocent until proven otherwise. This change aims to alleviate the burden on the majority of taxpayers, enabling about 80% to avoid the obligation of justifying every expense and bank transaction. Furthermore, the government intends to focus on auditing major contributors, raising the thresholds for investigation to approximately 600,000 euros and implementing a simplified income tax system labeled "Ganancias simple."
Milei's administration also promotes an initiative termed 'permanent popular regularization,' targeting greater financial integration by encouraging Argentinians to funnel their foreign dollars into the domestic financial system. This approach is part of a broader strategy to stabilize the economy and reinvigorate confidence among taxpayers, revealing the government's commitment to ensure both fiscal responsibility and labor market improvements, which could significantly impact economic recovery in Argentina.
