Argentina increases exchange rate by over 100%, hints at higher export taxes

Argentina’s new government, that only took office on Monday, announced a package of economic measures late Tuesday, including a major exchange rate devaluation while hinting at other initiatives that could affect the country’s agricultural export sector.

The country’s new finance minister Luis Caputo said in a press conference that the official exchange rate will be now 800 pesos per US dollar, up over 100% from the 365 pesos per dollar previously in place.

Although Caputo first said there would be no increases in export taxes on agricultural products, official sources later mentioned export taxes (retenciones) would increase to 15% for all products.

It is still unclear if, how or when this measure will be implemented as it requires parliamentary approval.

That said, a 15% tariff would mean higher taxes for wheat and corn exporters that currently pay 12%.

The one exception to the cross-sector 15% rate would be the soybean complex which already pays more than that, with soybean exports paying 33% of export taxes.