Buenos Aires Herald

November 16, 2012

Whatever its motives, President Cristina Fernández de Kirchner’s nationwide broadcast announcement of one-off tax relief for the Christmas bonuses of all salaries grossing under 25,000 pesos (around 98 percent of all pay) will do nothing to head off next Tuesday’s general strike by the anti-government branches of the CGT and CTA umbrella labour groupings (whose grievances prominently include millions of working-class wage packets entering income-tax brackets) — beyond this evident fact, opinions are divided. The more pro-CFK voices would argue that she is deliberately holding back raising the income tax floor to placate labour discontent until next year — not only with October’s crucial midterm elections in mind but also to factor this fiscal relief into next summer’s collective wage bargaining negotiations in order to lower pay increases and thus help tame the inflation which is even more a problem than the tax floor. But harsher critics would state that much as CFK would love to pull the carpet from under Tuesday’s strikers by defusing the tax floor issue, the dire fiscal straits of her administration do not leave any more wriggle room than this rather token Christmas gesture (which will still cost the Treasury a couple of billion pesos).

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