Wednesday, January 22, 2014

Government incompetence leads to a loss of freedoms


BUENOS AIRES, Argentina (AP) -- Argentines buying online must now submit a statement to the tax agency before they can receive the goods, as the government seeks to make such purchases more expensive and help curb capital flight.
Argentina's economy is suffering from a shortage of dollars and its foreign reserves recently plunged to their lowest level in more than seven years. The measure published Tuesday in the official gazette seeks to reduce the amount of dollars leaving the country.
The rule requires Argentines to submit a sworn statement to the AFIP tax agency before they can receive their purchases, which could be taxed by 50 percent of value. The measure applies to goods that enter the country using the postal service.
Consumer prices are among the biggest worries for Argentines, who often look for deals online to cope with the country's double-digit inflation.
Argentina's Electronic Chamber of Commerce, an umbrella group for several industry companies, organized a "Cyber Monday" in early December offering big discounts online. The initiative generated almost $30 million in online sales, which saw a 1,200 percent rise in the number of products sold from the year before, the group says.
Argentina can't attract international loans at market rates after the country's 2001-2002 economic collapse and uses its currency reserves to buy fuel overseas, meet foreign debt payments and finance economic stimulus programs. Authorities have been imposing currency controls meant to stem capital flight since 2011, also making it difficult to legally trade pesos for dollars.

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