Overview
- FITA’s plan would let firms credit employer social-security contributions against VAT, a change the group says would cut labor costs by about 30% and, through greater formalization, avoid a net fiscal loss.
- The proposal, drafted by economists Miguel Kiguel and Andrés Borenstein, was delivered to Commerce and Industry officials and is now on Secretary Pablo Lavigne’s desk with no policy decision yet.
- Industry leaders report roughly 11,000 registered job losses since December 2023 in a sector that employs about 108,000 workers and is operating with roughly half its capacity idle.
- Alongside the tax change, FITA asked for tighter import price monitoring and the return of customs reference values to deter under-invoicing, citing items declared at implausibly low prices, while flagging e-commerce platforms like Shein and Temu as pressures.
- Seeking to pivot to exports, FITA proposes a sectoral agreement with the United States and is coordinating with Brazil’s ABIT to advance that agenda.