What is the Bases Law and what are the main points

The Government will put to a vote this Monday the limited version of the Base Law, with labor reform and fiscal package included. The main text remained at 232 articles while the fiscal measures added 112 more articles. What are the main points of both initiatives?

A public emergency is declared in administrative, economic, financial and energy matters for one year.

At the last minute The Executive removed Banco Nación from the list, which generated widespread rejection. Aerolíneas Argentinas, Energía Argentina, Radio y Televisión Argentina and Intercargo SAU are subject to total privatization

Subject to privatization or concession were AySA, the Official Mail, Belgrano Cargas, Sociedad Operadora Ferroviaria and Corredores Viales.

The Nucleoelectrica Argentina Sociedad Anónima (NASA) and Yacimientos Carboniferous Rio Turbio (YCRT) can only become mixed, with State control.

The General Auditor’s Office of the Nation must carry out an examination regarding the privatization process of each of the companies and the Bicameral Privatization Monitoring Commission of Congress must control the process.

The pension moratorium approved during the Government of Alberto Fernández is repealed, by which people who did not reach their retirement years could enter a payment scheme and be able to retire. But at the request of the UCR, the Proportional Retirement Benefit was created in which people who do not reach 30 years of contributions, when they reach 65 years of age – when the Universal Pension for the Elderly (PUAM) begins to be collected )- They also receive a proportional fee for the years they contributed.

Income tax begins to be paid from a salary of $1,800,000 in the case of singles and $2.2 million for married people. After an arduous discussion – because the ruling party wanted the update to be annual – it was established that for the remainder of the year the adjustment for inflation (CPI) will be quarterly (in September) and then every six months.

The Simplified Regime for Small Taxpayers (Monotributo) updates the billing and quota ceilings, with increases of between 300% and 330%. The annual income ceiling would be $68 million, with the novelty that it will be for commerce and service activities alike.

Is for investments equal to or greater than US$200 million. They get tax, customs and exchange benefits. Among them, a single rate of Income Tax of 25% and the accounting of 100% of the Tax on debits and credits as payment on account of Profits.

The changes contemplate a reduction in the floor from which the tax begins to be paid and a decrease in the rates. According to the project, the non-taxable minimum will rise from $11 to $100 million and the deduction for family housing will increase from $56 to $350 million.

There is a 5-year advance payment program with a reduced rate, which then enables “fiscal balance”, with the taxpayer paying a very low percentage until 2038.

A benefit for the compliant taxpayer of half an aliquot point was included.

Laundering allows undeclared assets to be regularized up to US$100,000 without paying the special tax. Contemplates progressive rates up to 15% for amounts greater than US$ 100,000

In the first stage, which will last until September 30, 2024, the rate on the surplus will be 5%; in the second stage, until December 31, 2024, it will be 10%; and in the third, until March 31, 2025, 15%.

The moratorium will allow tax and social security obligations due as of March 31, 2024 to be paid in up to 84 installments with various benefits such as the forgiveness of all fines and up to 70% of interest on balances owed, depending the payment method.

The project empowers the Executive to order the total or partial dissolution, merger, division, modification or transfer of organizations of the central or decentralized administration of the state. But at the request of the opposition, a list was written with the organs that the state will not “be able to touch.”

You may not order the dissolution of CONICET; the Malbrán Laboratory, ANMAT, INCAA, ENACOM, INCUCAI, the Industrial Property Institute (INPI); the Nuclear Regulatory Authority (ARN), the National Commission for Space Activities (CONAE); the National Atomic Energy Commission (CNEA); the National Commission for University Evaluation and Accreditation (CONEAU); the National Securities Commission (CNV); the National Institute for the Single Ablation and Implant Coordination Center (INCUCAI); the Financial Information Unit (UIF); and the National Institute of Agricultural Technology (INTA).

The Executive is empowered to intervene for a period of one year, decentralized organizations with the exclusion of national universities, the bodies or agencies of the Judicial Branch, Legislative Branch, Public Ministry and all entities that depend on them; the National Administration of Medicines, Food and Medical Technology (ANMAT); the National Council for Scientific and Technical Research (CONICET); the National Institute of Agricultural Technology (INTA); the National Administration of Laboratories and Health Institutes “Dr. Carlos G. Malbrán” (ANLIS); the National Commission for University Evaluation and Accreditation (CONEAU); the Financial Information Unit (UIF) and the social security institutions.

The Executive Branch is authorized to unify, modify, or liquidate public trust funds. So that, as happened in February, this article does not make the law fail, it was established, at the request of the opposition and especially the governors, that if they dissolve a fund that was financed by a specific allocation, they will participate. If a fund financed by a specific allocation of a non-coparable tax is dissolved, the tax will once again be allocated to the National Treasury. Another important point: The “cold zones” Subsidy Fund was excluded which is what benefits residential gas consumption in the southern provinces.

Among the main points trial period extended -currently from 3 months- to six months. With the possibility that collective labor agreements can be extended up to 8 months in the cases of companies with 6 to 100 workers.

Fines for unregistered work are eliminated. This applies if the employer whitens those workers who are black. The measure aims to encourage registered employment.

The creation of a severance fund (type UOCRA) for compensation. It will be optional by collective agreement. The possibility of taking out insurance is also included.