La Derecha Diario Despite the tax cut, the government achieved higher revenue in March
The elimination of the PAIS tax and the reduction of export duties didn't prevent a sharp increase in tax revenues
Driven by the strong economic recovery achieved by the Government of Javier Milei, fiscal revenue in March reached $12.8 trillion, representing a 7% real year-on-year growth.
With this result, Milei's Government managed to close the first quarter with fiscal revenues in positive territory, all despite the tax and tariff cuts, as reported by the Revenue and Customs Control Agency (ARCA).
According to ARCA, the tax reductions implemented by the libertarian administration had a negative impact on revenue, although this was offset by the strong increase in economic activity.
The revenue
The Net Value Added Tax collected $4.3 trillion, registering a year-on-year increase of 55%. Within this tax, the Tax VAT rose by 65.0%, while the Customs VAT grew by 40.2%. Meanwhile, the Income Tax showed a year-on-year variation of 110.8%, reaching revenues of $2.2 trillion.
Regarding the Tax on Credits and Debits, the revenue reached $942.729 billion, with a year-on-year increase of 57%. ARCA noted that the fewer business days compared to the previous year had a negative impact on the figure.
On the side of resources allocated to social security, there was a significant increase, driven mainly by the improvement in the income of registered workers, which grew above inflation, and by the low comparison base of March 2024. Revenues from this concept amounted to $3.46 trillion, with a rise of 99.1%.
Regarding foreign trade, Export Duties caused revenues of $589.467 billion, reflecting a year-on-year variation of 90.1%, mainly driven by the increase in the exchange rate. Likewise, the growth in imports compared to last year had a positive effect. In terms of tariffs, the revenue was $430.035 billion, with an increase of 80.3%.
Meanwhile, the Personal Assets Tax reflected the impact of the tax advance corresponding to the next five periods, as established in the fiscal package. The revenue reached $31.225 billion, with a year-on-year variation of 83.3%.
According to estimates by the Argentine Institute of Fiscal Analysis (IARAF), national tax revenue for the first quarter of 2025 would have recorded a real year-on-year growth of 8%. Excluding taxes related to foreign trade, the increase would reach 20% in real terms.
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