The Argentine fruit industry has welcomed a 25% reduction in the country’s controversial export tax, saying the move will help them to be more competitive in overseas markets.
The Argentine Government on Wednesday lowered the tax from 4 pesos to 3 pesos per dollar in value. The reduction applies to 207 products, including fresh fruit.
“With this modification, we are aiming to develop the production regions and generate greater competitiveness to the growers so that they can continue to invest and create value and jobs,” said Minister of Agro-Industry Luis Miguel Etchevehere.
The taxes were implemented in January 2018 by President Mauricio Macri in a bid to balance the budget of the crisis-ridden country’s economy. But the tax marked a step backward for the free-market advocate who slashed agricultural taxes upon taking office in 2015 to “normalize” the economy.
The significant weakening of the peso over the last year for the agricultural industry meant that exporting goods has become increasingly expensive, impacting on companies’ competitiveness in international markets.
Various important actors in the fruit industry have praised the government for the decision to cut the export tax.
Agustín Argibay, president of the Argentine Chamber of Integrated Fruit Growers (CAFI) told local media Diario de Rio Negro: “The measure is undoubtedly welcome for the whole industry.”
“It is an important step that the national government is taking, acknowledging the crisis that the sector is in,” he was quoted as saying.
The publication reported that the move is expected to save the fruit industry 800 million pesos (US$19.1 million), including 500 million pesos (US$11.9 million) in the pome-fruit-growing region of Rio Negro alone. In 2018 the region exported around US$400 million of fresh apples and pears.
The industry is reportedly going to push for the export tax to be completely eliminated, which could happen by the end of next year.
Alejandro Zimmermann, president of the Argentine Chamber of Integrated Cherry Producers (CAPCI) commented that “while these measures do not resolve the complex issues affecting the fruit sector, they are without a doubt a favorable step which will have a positive impact on the fruit industry”.
Meanwhile, Adolfo Storni, president of Extraberries and Frutos de los Lagos – two of the leading blueberry and cherry exporters – told El Once that “the measure was necessary for and expected by the sector, as it reduces the tax pressure for the whole fruit sector”.