Argentina's 'millionaire tax' comes into effect

Tax on Argentina's richest people came into effect on Friday (local time). The tax has been levied in order to make fund provisions for medical supplies and relief to businesses in a global economy battered by coronavirus pandemic. The law passed by Senate in December last year approves the tax on Argentinians who have assets exceeding 200 million pesos (around 2.3 million USD)

The center-left government of President Alberto Fernandez hopes to raise about $3 billion from taxing the richest 12,000 of Argentina's 44 million inhabitants.

As per the law, taxable individuals will pay up to 3.5 per cent of the assets declared in the country and upto 5.25 per cent assets abroad.

The proceeds will be used to buy medical supplies, aid small and medium enterprises, fund social aid, and to provide natural gas to people off the energy grid.

Argentina's center-right opposition has criticised the taxes and has called them 'confiscatory'.

Argentina has been badly hit by the coronavirus, with more than 1.9 million confirmed cases of infection and more than 47,000 deaths.

The pandemic has exacerbated the already high poverty rate in a country which has been in recession since 2018, and has an unemployment rate of 11.7 percent.

In its annual report on economic inequality, Oxfam said Monday the world's 1,000 richest people had recouped their coronavirus-related losses within nine months, while it could take the world's poorest more than a decade to recover from the impacts of the global health crisis.

(With AFP inputs)