Friday, July 10, 2020

ECONOMY | 30-11-2017 12:09

Senate passes pension, tax reforms

The government received good news from the Senate yesterday where a majority voted in favour of two of its most important reforms in tax redistribution and pensions.

Argentina’s Senate yesterday passed tax and pension reforms as labour movements and leftist organisations marched on Congress to express their disapproval of the changes.

The pension reform package passed with a strong majority of 43 senators from the ruling Cambiemos coalition as well as from Peronists with close links to provincial governments. The 25 votes against the reform came from Kirchnerites and independent Peronists like Adolfo Rodríguez Saá and Liliana Negre. There were three abstentions.

Meanwhile, the tax distribution agreement signed among provincial governments and the national government passed 52 to 15 with two abstentions. The bill must pass individually in each of the signatories’ own legislatures. San Luis was the only province not to sign on.


The controversial pension reform bill would see adjustments to pensions calculated on inflation (comprising 70 percent of adjustments) and the coefficient of variation in wages (30 percent) instead of only on inflation and GDP growth, as per the original bill. Adjustments would be made every three months. The reform would also allow voluntary retirement until the age of 70.

Labour movements and leftist organisations marched on Congress yesterday to decry the changes, claiming pensioners would soon see reductions to their spending power.

The head of the Workers’ CTA Hugo Yasky, closely tied to former president Cristina Fernández de Kirchner, said the changes were “illegal and inmoral”.


For more read: "Tax reform can no more bypass fiscal federalism than Congress" by Time's columnist Michael Soltys.

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