AFIP to ARCA: Milei government announces ‘dissolution’ of tax bureau

Argentina’s government has announced it will dissolve its current tax bureau and replace it with a new “simplified” agency, cutting a third of jobs in the process.

In a statement, President Javier Milei’s government confirmed the closure of the Administración Federal de Ingresos Públicos (AFIP) and the creation of the Agencia de Recaudación y Control Aduanero (ARCA). 

The new entity will maintain AFIP's current dual role of overseeing tax collection and customs monitoring.

More than 3,000 AFIP agents who joined during former president Alberto Fernández’s 2019-2023 government will be laid off as part of a 34 percent reduction of current staffing levels, said the statement.

It accused those workers of being “irregularly hired” by the previous government.

According to Casa Rosada, the new ARCA agency will function "with a simpler, more efficient, less costly and less bureaucratic structure."

“This measure will reduce senior authorities by 45 percent and lower levels by 31 percent, which represents an elimination of 34 percent of the [overall] current structure, generating annual savings of 6.4 billion pesos," said the government’s statement.

The Office of the President said that the closure of AFIP "is essential to dismantle the unnecessary bureaucracy that has hindered the economic and commercial freedom of Argentines.”

The statement also said it would eliminate rules ensuring large salaries for senior officials, lowering their pay to similar to that of a Cabinet minister.

The ARCA will be headed by Florencia Misrahi, accompanied by Andrés Gerardo Vázquez at the Dirección General Impositiva (DGI) and José Andrés Velis at the Dirección General de Aduanas (DGA), who will lead the founding of the new agency.

"The government very happily announces that as of today the AFIP will cease to exist," said Presidential Spokesperson Manuel Adorni at a press conference.

"What belongs to each Argentine is theirs and no-one else's, no state bureaucrat should be delegated the power to tell an Argentine what to do with his or her property," he argued.

President Milei has implemented a series of budget-slashing measures since taking office last December, including the elimination or downgrading of a number of government ministries and state agencies.

The AEFIP union, which represents AFIP employees, said Monday it would consider strike action in response to the announcement.

"We are going to mobilise and we will take more measures as soon as we know the details. The most worrying thing is the 3,100 jobs of our colleagues," said AEFIP chief Pablo Flores.

– TIMES/NA