Argentina's Milei to seek 15% export tax hike on some grains -source

Argentina's Milei to seek 15% export tax hike on some grains -source

By Maximilian Heath

Argentina's new government of libertarian President Javier Milei will seek to raise export taxes to 15% on some grains, though that would not impact tariffs on soy, an industry source told Reuters on Wednesday.

The news comes a day after Economy Minister Luis Caputo laid out economic measures to fix an embattled economy, including raising taxes on some exports, though he had said that this would not apply to the agricultural sector.

Argentina is one of the world's top exporters of processed soy oil and meal, the No. 3 for corn and important producer of wheat and beef. Wheat and corn exports are currently taxed at 12%, while soybean exports are taxed at 33%.

La Nacion and other local media reported that Milei's government would seek to push through the tax increase via a bill that would be presented in Congress.

The grains export sector source with direct knowledge of the matter confirmed the La Nacion report. Meanwhile, a government source said official information would be released later in the day.

Milei, a libertarian economist, took office on Sunday pledging "shock" measures to try to fix the country's worst economic crisis in decades with triple-digit inflation, negative net foreign currency reserves and a looming recession.

The government is desperate for funds, especially foreign currency, with the grains sector the dominant driver of exports.

Caputo on Tuesday announced the first economic measures, which included a peso devaluation of over 50% and major cuts in spending. He flagged a provisional tax increase to "withholdings on non-agricultural exports," suggesting that grains were exempt.

"Once this emergency is over, we are going to move forward with the elimination of all export duties," he said.