Argentina’s President Javier Milei prepares second wave of reforms targeting taxes, labour laws and pensions after mid-term election gains
BUENOS AIRES: Argentina’s libertarian President Javier Milei is preparing a second wave of reforms targeting labour laws, taxation and pensions following his mid-term election victory.
The abrasive right-winger who previously dismissed opponents as “rats” and “traitors” now shows signs of being more open to dialogue.
His La Libertad Avanza party more than tripled its parliamentary seats in Sunday’s mid-term elections.
LLA and its centre-right ally PRO party will hold 107 seats in the 257-member Chamber of Deputies when the new Congress sits on December 10.
Milei proclaimed this new Congress will be “the most reformist… in Argentina’s history.”
Simplifying Argentina’s byzantine tax code represents Milei’s top priority.
The economist has previously branded taxes as “theft” and called offshore account holders “heroes” for escaping “the clutches of the State.”
His government proposes lowering 20 taxes while expanding tax bases by bringing more workers into the formal economy.
Lower employer payroll taxes would encourage companies to formalise workers and hire new staff.
Milei aims to shake up Argentina’s “anachronistic” labour code which he says is “over 70 years old and not designed for today’s world.”
He argues the current system drives informality and wants easier hiring and firing procedures.
A pro-Milei congresswoman’s bill proposes flexible working hours up to 12 hours daily and partial payment in non-monetary forms like food vouchers.
Milei also wants to end the “labor litigation industry” through fixed severance pay systems.
The labour ministry proposes negotiating wage agreements at company rather than sectoral level.
Milei claims these employer-backed proposals would benefit both companies and employees.
Argentina’s combative unions have so far categorically rejected these labour reforms.
Milei has floated reforming the country’s underfunded pension system as the third element of his reform triptych.
The president has repeated since Sunday that he’s prepared to deal with other parties to pass legislation.
Industrial Organization of Argentina president Martin Rappallini said “the challenge facing the government is to build consensus.”
Economist Pablo Tigani warned Milei’s electoral honeymoon could be short-lived.
He told AFP that “when they start cutting pensions and rights, coupled with falling wages and a recession, social protests could accelerate and even explode.” – AFP
