Argentine tax amnesty could boost government income: finance minister
BUENOS AIRES (Reuters) - Argentina may reduce its need to issue new debt, depending on how much of a boost state finances get from a tax amnesty that went into law earlier this month, Finance Minister Alfonso Prat-Gay said on Wednesday.
Economists estimate that the amnesty, which allows Argentines to disclose previously undeclared funds at preferable tax rates this year if they invest them in the country, could bring in between $40 billion and $80 billion.
The amount of debt the country would need to issue would be dependent on the results of the amnesty, Prat-Gay said at a Reuters Summit on Argentina.
"After 2017 the schedule of maturing debt lightens significantly. (The amnesty) will allow us to overcome the final challenging year of debt maturities," he said.
The amnesty runs to the end of 2016. Prat-Gay did not give a timetable for when the government would decide how it affects plans for debt issuance.
The center-right government of President Mauricio Macri took power in Argentina in December, swiftly agreeing to a deal over unpaid debt and pushing through pro-business reforms aimed at opening up the country to capital markets and attracting investment after years of protectionist rule.
But Latin America's No. 3 economy is still expected to shrink about 1.5 percent this year, with inflation ending the year at around 40 percent.
Prat-Gay said that what the government was doing was "a work in progress."
"There is no alternative but growth in Argentina," he said. "Inflation is starting to come down. (Gradual changes) are the only possible path. Our success will mean avoiding crisis."
Some $30 billion of investments have been announced in the last four months, he added.
Prat-Gay also said the government is planning to send a bill to Congress to modify capital markets in the coming weeks, without giving details.
(Additional reporting by Walter Bianchi; Writing by Rosalba O'Brien; Editing by Frances Kerry and Tom Brown)
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