Argentina's new government increases export taxes on disgruntled farmers

Argentina raised farm export taxes, the country's main source of foreign exchange, with a decree on Saturday aimed at increasing government revenue ahead of restructuring talks on about $100 billion in sovereign bonds and loans.

With the cash-strapped government facing significant debt maturities in 2020, farmers had been expecting an increase in export taxes on crops such as soybeans, wheat and corn. Growers, already harried by high financing costs in the inflation-racked country, where the benchmark interest rate is at 63%, had been dreading the expected increase in grains export taxes.

"Given the serious situation that public finances are going through, urgent adoption is necessary to meet, at least partially, budget expenditures with new resources," the decree stated.

Reuters contacted representatives of the ministries of economy and agriculture to obtain details of the measure, but the officials declined to comment on the technicalities of the decree, which said the tax on corn and wheat of 4 pesos per export dollar would no longer be in effect.

The government office that registers grains exports will be closed on Monday while the new tax structure is put in place.

"I understand that there was an increase in grains export taxes. What we do not know is in what magnitude because there are several ways to make the formulas.