The government led by Javier Milei managed to pass the so-called Basic Law and the Fiscal Package after almost six months, which, according to the administration, will “make Argentina a new country.”
It all started on December 27, 2023, when the newly arrived libertarian administration came to power. At that time, it was popularly known as the Omnibus Law due to the number of articles and issues it addressed. Previously, the president had deregulated the economy through an Emergency Decree. The legislative package was the other side of the economic and social reform proposed by La Libertad Avanza.
Months passed, as did the sessions and discussions. The law is now called Bases. It is less than half of what was originally presented. However, it includes several strong reforms and delegated powers to the executive branch. Depending on the measure used, it is either a significant or minor measure.
THE MOST IMPORTANT POINTS
The first and most discussed point is undoubtedly the delegated powers to President Javier Gerardo Milei. This means that he will have more power than usual due to being in an emergency situation. It is worth noting that almost all Argentine presidents have had this power.
On the other hand, the RIGI is an investment attraction model, granting significant tax exemptions to investors who invest more than $200 million.
Then there is a privatization package aimed at making the state more efficient. However, the list of companies to be privatized has significantly decreased from the original project.
Lastly, and also highly debated, modifications were made to income and earnings taxes, which critics of the government see as not very liberal.
In this way, the president obtains the fundamental tool he had long sought to generate growth in Argentina. Now, he faces the challenge of lifting the currency controls. It is worth remembering that in this country, it is very difficult to legally purchase foreign currency, leading to numerous exchange rates. Additionally, purchasing such currency through credit cards or other means incurs a tax of nearly 50%.
It is the number one challenge for a government that claims to be libertarian to establish a single exchange rate and ensure free access to currency, as with any other good that a person wishes to obtain.