MercoPress. South Atlantic News Agency

Argentines keep travelling overseas despite the ‘dollar clamp’ and the ‘Coca Cola formula’

Tax Office Director-General Toninelli admitted he doesn’t ‘exactly understand’ the way dollars are allotted to travellers

Despite the ‘dollar clamp’ and other obstacles to purchase the US currency in Argentina, the number of Argentines travelling abroad increased by 8% last March in comparison to the same period the year before although they spent 6.2% less than in 2012, it was reported by the National Statistics Bureau (INDEC).

Last March, 236,691 Argentine residents travelled abroad in comparison to the 219,132 who travelled the same month the year before. According to the report, Argentine travellers spent 304.5 million dollars last March while in March, 2012, around 324.7 million was spent.

On the other hand, receptive tourism decreased last March by 15.1% in comparison to the same period last year, with 198,890 entering Argentina although there was a 22% increase in comparison to the previous month (177,734 tourists in February). Foreign tourists spent an estimated 242.3 million dollars in comparison to the 299 million dollars last year.

To that respect the Argentine Tax Bureau (AFIP) tried to clarify how it determines the amount of foreign exchange provided to citizens who apply for the withdrawal of currency at the official exchange rate before travelling abroad. The gap between the official rate and the so called ‘blue dollar’ or parallel currently stands at over 90%.

The AFIP declared that “total foreign currency allotted to citizens travelling abroad is directly related to their purchasing-power.” The bureau provided this information after the Tax Office Director-General Ángel Toninelli gave a vague response to how they calculate the number, saying: “This is not the Coca Cola formula but it is very similar”.

Toninelli additionally remarked that “the formula changes periodically, with ingredients being provided by the Central Bank, the AFIP and others provided by God. In truth, I can’t explain it because I don’t exactly understand how it operates.”

Via a press release, the AFIP communicated that they used a “fiscal evaluation of funds utilized to purchase foreign currencies under the Tourism and Trips program, a regulation which is dictated by the Argentine Central Bank.”

With regard to Argentine residents transferring money abroad to support family members in foreign country, which is sent by many residents who have relatives in the neighbouring countries of Paraguay, Bolivia and Uruguay, the AFIP stated: “Foreign transfers designated for the assistance of family members are not subject to evaluations by the tax bureau according to the Central Bank regulation.”

The AFIP highlighted how the organization is able to make these personal fiscal evaluations, stating that it obtains the data from various sources: banks, credit cards, private schools, expenses and nominal salaries, as well as tax forms.