The announcement of the Minister of Economy, Luis Caputoregarding the 10-point reduction in the PAIS tax rate, today at 17.5% if the Fiscal Package and the Bases Law are approved, generated a predictable expectation in the world of businessmen, especially in those most dependent sectors. of imports.
While economists warn that this rate cut could leave room for a correction in the exchange rate that some consider already showing signs of delay, companies began to do the math. For now without devaluation, the reduction anticipated by the minister would imply an improvement for importers of 8.5% from the current level of “importing dollar.” It is the price at which they end up paying for the merchandise or inputs after applying the current tax to the official wholesale dollar. That price today stands at $1,060 and, according to a calculation shared by the analyst Salvador Vitelli, would fall to $969, generating a cost reduction whose rise, at the time, no businessman had in their plans.
“It would be an important relief, without a doubt a good measure that would contribute to reducing costs. It would be going back to the previous point, in December we were prepared for the devaluation but not for the increase in the PAIS tax, much less in the magnitude in which it was applied,” they were honest from the automotive sector, one of the most affected given the volume of imports. to produce. The announcement had a similar impact on another of the sectors highly dependent on imported inputs, such as electronics and household appliances. “It would contribute to improving the equation, it is obvious,” they said, meeting in the context of a business meeting.
“With the possible reduction of 10 points of the PAIS tax, the import exchange rate, at today’s values, would be at levels at the end of July 2023 (prior to tariffing imports) and below the pre-STEP value of 2023 ( prior to the devaluation towards $350)”, Vitelli contributed.
However, it does not escape the analysis that, although none of those present – among whom were CEOs of mass consumption companies, the financial sector and also technology – placed a possible devaluation among their main concerns, they recognized that the possibility is among the possible short-term scenarios and that constitute a challenge that, if it occurred, would be achieved in an orderly manner with control of inflationary expectations.
“There is no precedent that a rise in the dollar is not reflected in prices. Inflation will always react to a devaluation,” said a representative of the food and beverage industry.
In macroeconomic terms, meanwhile, there is an understanding that this eventual transfer to prices could be cushioned in part by the lower tax pressure that the lower rate on imports would imply.
In any case, this possibility arises from the growing concern about the “equilibrium” exchange rate. While the Government insists again and again that what determines these variables is much more than the comparison of the evolution of the dollar against inflation and that competitiveness will be given by structural improvements that enhance the productivity of the economy, among which For example, they mention the more solid fiscal and monetary position, there are multiple opinions that identify the real exchange rate as a potential problem.
According to the statistics published daily by the Central Bank, the real multilateral exchange rate – an indicator that combines the evolution of the official dollar with respect to the main countries with which Argentina maintains fluid commercial exchange – is located at levels similar to those of October of last year.
