Argentina moves to cut gas subsidies under Zona Fría law
Argentina’s national government is preparing a legislative reform that would sharply reduce the “Zona Fría” gas subsidy regime. A bill approved by a majority in the Chamber of Deputies calls for the subsidy to remain only in the extreme‑cold regions of Patagonia, Malargüe and the Puna, and to be limited to households qualifying for the new focused energy subsidy (SEF). The proposal, slated for a special congressional session on 20 May, is presented as a fiscal‑balance measure, arguing that the 7.5 % levy on natural‑gas prices no longer covers the cost of the subsidy.
If enacted, the cut would remove benefits for dozens of municipalities across Buenos Aires Province, Córdoba, Santa Fe, San Luis and others – affecting up to 55 departments in Buenos Aires alone. Lawmakers say the change will reduce the energy‑budget deficit, while opposition figures warn that the loss of discounts of 30‑50 % on gas bills will hit workers, retirees, merchants and vulnerable families, deepening household indebtedness.
Local officials, such as Junín councilor Clara Bozzano, have warned that the removal of the Zona Fría benefits will negatively impact family incomes and exacerbate inflation‑driven hardships. The debate reflects broader tensions over the Milei administration’s austerity agenda and its impact on essential public services.