The Argentine government has managed to increase tax revenue in February despite eliminating the PAIS tax and reducing export duties. This result defies expectations and underscores the economic recovery the country is experiencing.

Tax Cuts and Revenue Growth

President Javier Milei’s administration has pursued tax reductions as part of its broader economic deregulation and fiscal adjustment plan. However, rather than leading to lower tax collection, the latest data reveals a significant increase in fiscal revenue.

Key Revenue Drivers: VAT and Income Tax

The strong revenue growth has been primarily driven by higher collection from Value-Added Tax (VAT) and Income Tax (Ganancias). These factors suggest a resurgence in economic activity, increased consumption, and improved corporate earnings, offsetting the drop in revenue from eliminated taxes.

This outcome reinforces the government’s pro-market approach and could further strengthen investor confidence in Argentina’s economic stabilization strategy