Tax reform: The Milei government moves forward with the elimination of the check tax

The Government of Javier Milei is moving forward with the gradual elimination of the tax on bank debits and credits, known as the check tax, as part of the tax reform that will be sent to Congress before 2027.

The measure is part of the official policy aimed at reducing the tax burden, while maintaining fiscal balance as the central axis of the economic plan.

According to reports, the initiative will include a gradual mechanism similar to that applied in the reduction of export duties. In this case, the scheme would allow the amount paid for this tax to be increasingly used as advance payment on Income Tax, until reaching 100% and, ultimately, its total elimination by 2028.

The proposal has been developed since the beginning of the administration in the offices of the Ministry of Economy, under the direction of Minister Luis "Toto" Caputo and Secretary of Finance, Carlos Guberman.

However, its progress was initially conditioned by economic factors, such as the need to maintain a fiscal surplus, and political factors, in a context of reduced legislative strength at the beginning of the administration.

The project responds to a horizon of lower tax pressure, but an unnegotiable fiscal balance. In this sense, one of the main objectives is to reduce the impact of taxes on economic decisions, seeking a more neutral and equitable system.

Within that diagnosis, the check tax is one of the most distorting taxes. Currently, it taxes bank debits and credits at a rate of 0.6% at each end of the transaction, which implies a total burden of 1.2% on the formal financial circuit.

The official strategy plans to replicate the model used for the reduction of export duties. In that scheme, the reduction is implemented in stages with defined calendars.