Nicolas Perez - Oficina de Presupuesto del Congreso

SELF-EMPLOYED WORKERS AND THEIR RELATIONSHIP WITH THE SOCIAL SECURITY SYSTEM – JANUARY 2023

by Nicolas Perez | Jan 18, 2023 | Employment and Social Security

The self-employed and simplified-regime taxpayers (monotributistas) represent 26.2% of the contributors to the Social Security system, but their current contribution is not sufficient to cover even a minimum retirement pension, a benefit that applies to most of the categories of self-employed workers.

If the self-employed retirement pension were self-financed, their contribution to the system’s total would increase from 3.4% to 15.7%. In absolute terms, last December’s collection would increase fivefold: from ARS9.556 billion to ARS50.533 billion.
The self-employed have a high tax burden, which can represent up to 50% of their income. For simplified-regime taxpayers it represents an average of 4%.
The system of Social Security contributions involves a certain degree of regressivity since its weight is relatively higher for the lowest categories.

ECONOMIC AND FINANCIAL STUDY ON TRUST FUNDS

by Nicolas Perez | Jan 17, 2023 | Specific Budget Issues

There are a significant number of trust funds in the Argentine Public Sector (National, Provincial and Municipal). This report focuses on the twenty-eight trust funds of the National Non-Financial Public Sector in which the National Government is the trustee.
The budgetary regime of trust funds does not follow the same rules as those governing the National Government Budget.
In 2021, the expenditures of these funds were equivalent to 0.7% of the national GDP, and their resources amounted to 2.1%.
Trust Funds grew at a higher rate than expenditures as of 2018, generating a liquidity surplus: the financial surplus expanded from 0.08% of GDP in 2012 to 1.42% of GDP in 2021.
In 2021, 58% of Trust Funds resources were provided by the National Treasury, 18% from tax revenues and 17% from property income.
The main funds are used to subsidize energy and transportation or to finance public works.
Necessity and Urgency Decree (DNU) 829/2022 banned transfers to trust funds, state-owned enterprises, and other entities with freely available funds from January 1, 2023.
Not all trustees report the details of the transfers made to the beneficiaries.

ECONOMIC AND FINANCIAL STUDY ON TRUST FUNDS

ANALYSIS OF NATIONAL TAX REVENUE – 2022

by Nicolas Perez | Jan 16, 2023 | Tax Revenue

Tax revenue amounted to ARS2,307.476 billion in December 2022, which implied a growth of 95.6% year-on-year (YoY). As a result, the annual total was ARS19,982.483 billion, an increase of 81.6% year-on-year (YoY), implying an inflation-adjusted expansion of 5.2% YoY.

In terms of the cumulative amount for the year, the most important increases in real terms were in Income Tax (15.6% YoY), VAT (4.2% YoY), Tax on Credits and Debits (3.9% YoY) and the PAIS Tax (84.4% YoY). Social Security revenues grew 5.2% YoY, whereas Export Duties decreased 2.2%.

An analysis of the performance of tax revenues during 2022 is presented in this report. In addition, the main causes of variation are described, among them, the legislative changes that have had an impact on tax collection.

In general terms, the increase in tax revenue in real terms reflected the recovery in economic activity, leaving behind the restrictions generated by the Covid-19 pandemic, which was reinforced by the increase in international prices of commodities as a consequence of the war between Russia and Ukraine, in addition to a global inflationary context and the return of certain limitations on the supply side and bottlenecks in logistics.

PUBLIC DEBT OPERATIONS – DECEMBER AND CUMULATIVE 2022

by Nicolas Perez | Jan 13, 2023 | Public Debt Operations

Securities totaling ARS1,174.791 billion were placed in two auctions.
The IMF provided net financing of USD3.309 billion in December.
January maturities are estimated at USD13.957 billion.
In 2022, gross debt issuance totaled USD162.977 billion and principal repayments amounted to USD116.335 billion.

PUBLIC DEBT OPERATIONS - DECEMBER AND CUMULATIVE 2022

ANALYSIS OF THE NATIONAL GOVERNMENT BUDGET AMENDMENTS FOR THE YEAR 2022

by Nicolas Perez | Dec 27, 2022 | Budget Amendments

The Budget Law passed by the National Congress is amended during the year in accordance with the delegation of powers arising from the regulations in force. Within this framework, it is important to analyze those amendments to provide updated data on the budgetary dynamics throughout the fiscal year.

To this end, these periodic reports focus on the analysis of budgetary amendments made by Administrative Decisions of the Chief of Cabinet of Ministers (JGM) or by Necessity and Urgency Decrees (DNU).

DIRECT CASH TRANSFERS TO INDIVIDUALS OR HOUSEHOLDS 2019-2021

by Nicolas Perez | Dec 26, 2022 | Monetary transfers to individuals

Direct cash transfers to individuals or households represented about 45% of the National Government expenditure and were equivalent to 10.7% of GDP in 2021. During 2020 they had increased significantly to mitigate the effects of the quarantine.

– Between 2019 and 2021, pensions fell as a proportion of GDP (by 0.66 percentage points) and social aids increased (1.02 p.p.).
– These aids also grew in the number of benefits.
– The beneficiaries of the contributory subsystem decreased by 300.000 (because of the beneficiaries of contributory family allowances) and their share of GDP also fell (0.4 p.p.).
– In the same period, non-contributory benefits increased their share: 3.3 million benefits were added, and expenditure increased by 0.9% of GDP, which shows that the population in need of assistance is growing.
– In 2021, pensions decreased as a proportion of GDP to lower levels than in 2019, including those obtained through moratoriums.