2023-06-06 04:33:00
Tax collection in May, if the effect of inflation is discounted, was lower than that registered in May of last year. It is the fifth consecutive month that something similar has happened. In other words, from the beginning of 2023, inflation not only deteriorates the purchasing power of salaries and pensions, but also has an impact on the money collected by the State.
INDEC will report the consumer price index (CPI) for May next week. Only then can an exact calculation of the loss be made. But to make a realistic estimate, since May collection grew by almost 105% compared to May 2022, if the CPI for last month resulted in year-on-year inflation of close to 110%, we would be talking regarding a drop of close to 5%.
The loss seems small, but the accumulated is not so. In the first five months of 2023, once morest that year-on-year inflation that we have just estimated at 110%, collection barely grew by 92.5% compared to the same period in 2022; although to be more precise, average interannual inflation must be computed, since it has been growing month by month.
It may be that a particular tax shows a relative gain with respect to inflation, but overall the picture is negative. The national authorities, for example, try to highlight in their presentations that the Value Added Tax grows above inflation, which would be a sign that consumption has not suffered.
Reality refuses to fit in with that interpretation. The signs of stagnation in economic activity are plain to see, and recent reports from organizations such as the Córdoba Chamber of Commerce and the Córdoba Commercial Federation clearly quantify the drop in sales in May compared to those of May of last year. : in a sense, Cordovan businesses sold 18% fewer units; In another sense, 65% of the merchants stated that they had invoiced below their expectations. As we have said on other occasions, what happens in Córdoba is, to a large extent, a reflection of what happens in the rest of the country.
Let’s agree that the drought affects the state coffers. As exports fall, collections fall. In any case, in this specific category, the numbers for May were not as negative as they might have been, since the “soybean dollar” stimulated a rise in liquidations. June will not have that benefit.
We also don’t know if the rebound in car sales that May showed will continue in June. For those who have the capacity to save, given the impossibility of hoarding a hard currency like the dollar and the constant deterioration of the national currency due to inflation, buying a new car is equivalent to an investment.
With everything, the key is that if the State collects less, it should cut its expenses instead of increasing the deficit, which is financed with issuance, which feeds inflation. But the logic with which the authorities make decisions tends to increase the problem, instead of providing a solution.
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