OPC 5 Cost Estimates 5 UPDATE ON THE FISCAL COST OF THE WEALTH TAX AMENDMENT BILL – DECEMBER 2021

UPDATE ON THE FISCAL COST OF THE WEALTH TAX AMENDMENT BILL – DECEMBER 2021

December 29, 2021

This report complements the analysis of the Wealth Tax amendment Bill S-2150/2021 in view of the changes introduced in the Chamber of Deputies.

The original Bill proposed to raise the minimum exemption to ARGENTINE PESOS EIGHT MILLION (ARS8,000,000) for taxable assets except for shares or participations in the capital of companies covered by the Law and to ARGENITNE PESOS FIFTY MILLION (ARS50,000,000) for real property destined to the residence of the taxpayer or deceased in an inheritance.

The most important changes with fiscal impact introduced are the creation of two new tax brackets for those who have taxable assets exceeding the non-taxable minimum between ARS100 million and ARS300 million, and another one for those who have more than ARS300 million (Section 3 of the Bill).

Additionally, as from fiscal year 2021, an additional tax rate on assets located abroad will be in force permanently (Section 4 of the Bill).

The usual methodology of the OPC considers as a basis for the calculation the text of the law in force, so that the enactment of Bill 70-S-2021 would generate net revenues for ARS85.787 billion during 2022, a figure that includes a drop as a result of the increase in the non-taxable minimum (MNI) and the increase in the value of dwelling houses that had already been approved by the Senate, and the increases in the tax rates introduced by Sections 3 and 4 of the text under analysis.

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