Argentina’s President-Elect May Suspend Soybean Tax for 90 Days

Argentina’s president-elect, Mauricio Macri, is considering eliminating the country’s export tax on soybeans for a period of 90 days as a move to increase sales by farmers who have been stockpiling $8 billion worth of the oilseed, according to reports from Bloomberg.

Argentina’s export tax currently stands at 35%. The possible loss of revenue due to the suspension of the tax may be offset by an increase in dollars into the country’s Central Bank reserve, which currently is at its lowest since 2006 at $25.8 billion.

The plan to suspend the soybean export tax is only one of a number of proposals being taken into consideration, however the plan is not being supported by the country’s agriculture team, due to the fear that it may prove detrimental to the country’s oilseed crushers and exporters.

The final decision on the possible suspension will be made on December 10, the day the Central Bank will report exactly how much money it is holding. If the suspension is approved, it will be reinstated in March with the arrival of the new soybean crop. Exports of new soybeans would face a tax of 30%.

Macri has also announced plans to ease currency controls when he assumes office on December 10, and investors are foreseeing such a move causing a possible 35% devaluation of the peso, but which could further help the country’s farmers selling their crops on international markets.