Argentine companies pay the second highest tax rate in the world

The tax burden on Argentine companies is the second highest in the world, only exceeded by that which exists in the Comoros, a small country of Africa formed by three islands in the Mozambique Channel.

According to the latest Doing Business report, a joint project of the World Bank and the PwC consulting firm, the total tax rate and mandatory contributions must pay a local business during its second year of business is 106%, expressed as a percentage of your benefits.

Worldwide, only two countries have percentages above 100%: Argentina and the Comoros, which reach 219.6%. In neighboring countries, the percentages vary from 34% for Chile to 83.7% for Bolivia, from 65.1% in the case of Brazil.

The total tax rate measures the amount of taxes and mandatory contributions paid by businesses (after allowable deductions and exemptions) as part of commercial profits.

This number It provides a measure of the cost of any taxes that a company supports. The methodology takes into account all the taxes and contributions you have to pay (at the federal, regional and local levels), as well as any taxation affecting the commercial accounts. The main differences between countries are labor expenditures and value added taxes.

"Do not be surprised that Argentina is located in second place with the highest tax burden in the world, with more than 100 taxes nationwideThe overlap of provincial and municipal taxes means that businesses can pay three different taxes in the same way, "said Roberto Cachanosky at Infobae.

And he detailed some examples: provinces charge gross revenue on sales and businesses they pay a certain percentage on the volume of the gross business figure; but at the same time, some municipalities apply the hygiene rate, which is also a percentage of what companies based in this municipality charge.

In addition, when the company pays taxes, the national government levies a tax on bank debits. "In Argentina, the nonsense of have to pay a tax to pay taxes. A company pays twice on the same tax base, its sales plus tax on checks, to pay provincial tax and municipal tax, "said Cachanosky.

Since the state does not allow adjustment of balances to account for inflation, 35% of income tax is nominal and climbs to 45/50 % since the state collects taxes on non-existent profits, said the economist. In addition, he warned that this phenomenal tax burden at the national, provincial and municipal levels is holding back investment as companies seek to invest in countries with the lowest tax burden.

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