Argentina agricultural sector faces high tax burden and retention demands

Economic analysts in Argentina are highlighting the heavy tax burden facing the agricultural sector and businesses. According to the FADA index, taxes accounted for 58% of agricultural income in September. While this is a four-point decrease from June, experts note the drop is due to improved grain prices rather than a reduction in tax rates.

In the agricultural sector, producers are increasingly prioritizing the reduction of export retentions over demands for a higher exchange rate. Current retention levels vary by product, with soybeans at 24%, corn at 8.5%, wheat at 5.5%, and sunflower at 4.5%.

Broadly, economists suggest that Argentina must address its historical dependence on the US dollar and work toward a model centered on the peso to foster growth. For small and medium-sized enterprises (SMEs), managing tax strategies and costs is becoming essential to maintain competitiveness against rising social charges and logistical expenses.