MercoPress. South Atlantic News Agency

CFK administration increasingly jittery about global crisis

Money, money,money deseperate for money

Argentine President Cristina Fernández de Kirchner's government defended the controversial financial incentive scheme proposed in its anti-crisis bill last week, which will be debated this week in Congress, stating that there is “no chance” it will promote money laundering.

The measure attracted strong criticisms from the opposition as well as support from pro-government sectors, leading to expectations of a "tough" debate over the package that looks to soften the blow of the global financial crisis. Mrs. Kirchner's bill included a plan to offer sweeping tax breaks for companies that formally acknowledge all their workers and for Argentines who repatriate savings they stashed away abroad. On Sunday CGT umbrella union leader Hugo Moyano spoke out in support of the measure from Mar del Plata, saying, "The government is obliged to ensure that all workers are formally put on the books, and this will not be achieved through adverts on television but rather with inspectors on the street." He added that "there is a serious worry in certain sectors" over the effects of the crisis, "because this might lead to dismissals and suspensions, as is already happening". Moyano did, however, say that the government "should have done this earlier" and not "waited for the effects of the crisis." Meanwhile, head of the opposition UCR caucus, Oscar Aguad, said that pro-Kirchner lawmakers were "not convinced" over whether they should approve the measure. The Córdoba deputy, joining the chorus of opposition detractors, launched a scathing attack on the scheme, stating that, without other "incentives," the "money which has been laundered at all cost" will only make its way into the economy. Aguad said that the repatriation and debt amnesty included in the bill is "without doubt" the measure that is coming up against most resistance, "because it is closely linked with laundering money that has been obtained through illegal activities." "The government will have to be very careful if they are to convince at the very least their own supporters that this is not an operation aimed at laundering criminally obtained money," he added, before confirming that the UCR "will not support" these measures. In response to these statements, pro-Kirchner deputy José María Díaz Bancalari said that there is "no chance" that the measure promotes money laundering. Díaz Bancalari maintained that "there is no chance that (the measures) will incur any sort of crime," recommending that the opposition "read the bill" that was sent to Congress. Directly referring to the UCR, he stated that "we don't run away in a helicopter, we divide the three branches of government as is defined; and if all three are working, then there is no chance" that illegally acquired money might come into the country. Also moved to defend the bill was head of the Federal Administration of Public Taxes (AFIP), Claudio Moroni, who said that the moratorium and incentive scheme was essential to confront the "unprecedented" and "complex" international situation, adding that the government should also look into the possibility of increasing income tax. "We want to ensure that Argentina overcomes this complex situation as best it can," said Moroni in justification of the measures. Meanwhile, the head of the National Office for Commercial Agricultural Control (ONCCA), Ricardo Etchegaray, stated that the tax moratorium is necessary in light of an "extraordinary scenario" such as the global financial crisis. Asked whether he thought the measure goes against his bureau's efforts to close tax evasion channels, Echegaray responded resoundingly: "No, not at all. For extraordinary scenarios, you have to find extraordinary solutions." (BAH).