Updated 08:48 AM EST, Sun, Dec 04, 2016
slide left arrow
slide right arrow

Macri Eliminates Tax for Mining Corps

  • +
  • -
  • Sign up to receive the lastest news from LATINONE
Argentina Faces First Presidential Runoff In Its History
BUENOS AIRES, ARGENTINA - NOVEMBER 22: Opposition presidential candidate Mauricio Macri (C) casts his ballot on November 22, 2015 in Buenos Aires, Argentina. Argentina is facing its first presidential election runoff in the history of the country on Sunday. Macri is squaring off against Daniel Scioli from the ruling party. (Photo by Mario Tama/Getty Images) (Photo : Mario Tama/Getty Images)

Argentina's President Mauricio Macri has just announced that he is giving mining companies relief in taxes.

The announcement made on Friday was noted to have added to the elimination of currency and capital controls, adding to a $2 billion slump in mining efforts over the past few years.

The move is going to greatly benefit mining companies. According to TeleSur TV, Macri said that the retention taxes on mining exports are now finished, and the company intends to increase the amount of projects to bring greater investments instead. He said, "We are going to work together with the governors (of the provinces) to develop new projects, always putting care for the environment first."

Still, the president did not specify how the country can lessen the environmental impacts of mining to protect their natural resources.

The tax allowance will save miners about $233 million, which could explain why representatives of mining companies are welcoming the decision. As noted, it will represent an 8 percent drop in production costs, which could increase the competitiveness of investors putting in their money to mining in the region.

Turkish Weekly also noted that the reduction will greatly benefit companies already mining in the area, including Barrick Gold, Goldcorp and Yamana Gold, as well as Glencore and AngloGold Ashanti. With the cut in taxes, Macri urged the mining sector to increase their investments as they did in neighboring countries Chile and Peru.

Critics are already against Macrii's decision. Daniel Thomas, who is with the Front for Victory party, said about Macri's announcement, "If I need to choose between reducing the retention taxes on multinational mining companies and universal allowance, pensions, and public works in municipalities, I'll stick with the latter."

Still, for those who think that Macri's plan will be the downfall of Argentina, it has been noted by TeleSur TV that the decree only eliminates federal retention taxes. Mining companies are still expected to pay royalties to the provincial government as well as other set taxes and customs.

So far, his strategy seems to be working. Turkish Weekly noted that more dollars were brought in the county since he decided to reduce these taxes. The agriculture sector, for one, has already brought in more than $4 billion of proceeds into the country beginning February 1.

Mining is not the only corporate tax that Macri eliminated. In December, just a few days before taking office, he reduced tax on beef, corn, and wheat as well as the industrial sector in general. Later on, he also reduced taxes on soybeans, from 35 percent to 30 percent.

© 2015 Latin One. All rights reserved. Do not reproduce without permission.
  • Sign up to receive the lastest news from LATINONE

Most popular

Today's Photo

Real Time Analytics