Photo via belephant.co

Argentina’s Congress unanimously passed the so-called “support to entrepreneurial capital” bill yesterday, which in theory should make it a whole lot easier to set up a company in the country. Roberto Basualdo, President of the Senate’s subcommittee of regional economies and small and medium-sized businesses (Pymes) told press that the law “will give dreamers a big helping hand” and “will help to create more jobs.”

The senator went on to say that the law could help the sector grow to “50 companies for every 1,000 inhabitants.” Argentina’s current ratio is of 15 businesses for every 1,000 people. This is not surprising, considering the most likely cause of this low number is the amount of red tape small business and the people trying to found them have to deal with. It’s not just bureaucracy though, budding entrepreneurs have to contend with a less than friendly tax system before getting their ideas off of the page in Argentina.

Delving into the specifics, the law intends to make the process easier by creating a business structure specific for these type of smaller scale companies and startups. They will be called simplified stock companies (sociedad de acciones simplificadas) and those willing to set one up will be able to do so via internet — bank account and tax ID included — in less than 24 hours. Manuel Tanoira, Director of Public Policy of the Argentine Entrepreneurial Association (ASEA), told Ambito that the same process currently takes between six months and a year.

The law also grants the businesses several fiscal benefits, such exempting the initial investments from paying the income tax and the investors of paying any taxes on 10 percent of their annual profit.

Moreover, the law creates a Registry of Entrepreneurial Capital Institutions and sets up a Fund for Development, where the State will use public funds to partially finance, along with the private sector, more promising projects.

Another key aspect of the law is the fact that it will enable public crowdfunding. The process will be supervised by the State’s stock exchange (Comisión Nacional de Valores) and will provide a list of all web platforms enabled to hold crowdfunding.

In a visit to an ice cream company in the Province of Buenos Aires today, President Mauricio Macri celebrated the bill’s passing. “We are calling the world’s big companies to come invest in Argentina, but we all know that more than half of the jobs are created by small businesses,” Macri said.

The president went on to highlight that being an entrepreneur in Argentina needs to stop being a “hurdle race,” because “on top of the fact that we have someone willing to risk his or her own capital, spend its time, effort to start its own business, all the State does is set obstacles in the way,” Macri concluded.