Argentina u-turn on soya export taxes
October 26, 2016
Argentina’s president Mauricio Macri announced in October that the country would not reduce export taxes on soya this year or in 2017, as previously stated, Reuters reports. Instead, it would reduce the tax by 0.5%/month from January 2018 to December 2019.
Macri took office in December last year and cut the export tax on the country’s main cash crop, soya, from 35% to 30% with further cuts planned for this year.
Reuters reported that due to a recession in the country that lead to forecasted difficulties in meeting budget cuts, cabinet chief Marcos Pena said in September that the reductions planned for the end of 2016 might be postponed.
One of Argentina’s largest agricultural trade groups, Coninagro, said it generally opposed export taxes but “it is necessary to accept the government’s proposal” in light of the difficult economic situation in the country.
The plan included a 5% rebate to producers in the north who are not in the main soya belt, as their transportation costs were higher, Macri said.
According to the report, agriculture minister Ricardo Buryaile said the tax would be reduced gradually month by month to prevent “speculation”, as there were concerns that farmers would hold off planting and harvesting until the tax was reduced.
Argentina is the world’s third-largest soyabean producer and exporter after the USA and Brazil, according to the US Department of Agriculture. In the 2016/17 crop year, which began in October, it was expected to produce 57M tonnes of soyabeans,10.7M tonnes of which would be exported.