By decree, export taxes on biodiesel have been increased from 8 percent to 15 percent in what the government is calling an effort to harmonize biodiesel and soybean oil export taxes.
The move comes amid jitters in the agricultural sector about potential plans to cancel or slow down the progressive reduction of export taxes on soybean – which has also now seemed to have been put to bed – and after a series of adverse decisions against Argentine biodiesel producers meted out by the United States. An association of biodiesel producers has already warned that the higher rate may trigger closures and job losses.
Decree 486 signed by President Mauricio Macri, Cabinet Chief Marcos Peña, Treasury Minister Nicolás Dujovne, Production Minister Francisco Cabrera and Energy Minister Juan José Aranguren, sets out that “in keeping with the progressive reduction of export taxes on soybean oil set out by Decree Nº 1343/16, it is necessary to continue to promote convergence of export taxes between the aforementioned product and biodiesel.”
Export taxes on biodiesel were raised from 0 to 8 percent in December 2017 and public news agency Télam has reported that the increases – set to come into effect on July 1st – was planned and not related to the ongoing tensions over soybean oil export taxes. The differences in the export taxes between biodiesel and soybean oil has been pointed to by US producers as a hidden subsidy, which the Argentine government has always flatly denied.
Claudio Molina, head of the Asociación Argentina de Biocombustibles e Hidrógeno, told radio FM La Patriada some factories could shut and that “this measure will end up closing the door on exporting to Europe.”
Currently the export taxes on soybean oil are at 27.5 percent and have been falling by 0.5 percent a month. Macri made cutting export taxes on agricultural goods one of his first actions when he came into office in 2015.