On Monday, the Argentine government announced a significant restructuring of its revenue and customs service with the dissolution of the Federal Administration of Public Income (AFIP). This move aligns with President Javier Milei’s broader agenda aimed at reducing the size of the state and eliminating what he describes as inefficient bureaucracies. The newly established Customs Collection and Control Agency (ARCA) is said to be a more streamlined and cost-effective entity, designed to operate with less bureaucracy and significantly lower salary levels for senior positions.
During a press conference, Presidential spokesman Manuel Adorni detailed the implications of this structural change, noting that the new agency will lead to a drastic reduction in personnel by eliminating 45% of senior roles and 31% of lower-level positions. Overall, this represents a reduction of 34% in the workforce, which is anticipated to yield annual savings of approximately 6.4 billion pesos (around $6.5 million). Additionally, about 3,100 employees deemed “irregular hires” from the previous administration are set to be reassigned, further emphasizing the administration’s commitment to reorganizing its workforce.
Adorni explained that the decision to dissolve AFIP is rooted in concerns over its oversized organizational structure, which has been ineffective in efficiently managing tax collection, customs, and social welfare functions. The new agency is expected to address these inefficiencies and improve the management of public resources, thereby enhancing the control of customs activities. The Argentine presidency underscored that personnel reductions were essential for dismantling unnecessary bureaucracy that has historically stifled economic and commercial freedoms for its citizens.
The overarching intention behind these measures extends to aligning salaries within ARCA to be more in line with those of other government officials. The current head of AFIP, who earns 32 million pesos per month, will see their salary drastically reduced to match that of a minister. Similarly, salaries for directors overseeing taxes and customs will also be significantly lowered, addressing disparities that previously placed AFIP’s pay scales higher than those for the president and high-ranking officials like Supreme Court members.
In the transition to ARCA, the current AFIP leadership structure will undergo changes, retaining Florencia Misrahi as the general administrator while appointing new general directors to oversee tax and customs operations. This restructuring symbolizes a broader ideological shift championed by the Milei administration, with a recentering towards liberalism and a disdain for what they view as fiscal overreach by the state. Adorni emphasized this ethos, asserting that the government is committed to fostering an environment where individuals have autonomy over their resources without unwarranted interference by bureaucrats.
President Javier Milei took to social media to celebrate the dissolution of AFIP, expressing his enthusiasm with a post that simply stated, “Goodbye AFIP,” accompanied by visually striking imagery. This gesture underscores the fervor with which the Milei administration is pursuing its reform agenda, aiming to pivot Argentina towards a vision of reduced governmental oversight and enhanced individual freedoms. The transition to ARCA represents not just a fiscal maneuver but a cultural shift, reflecting Milei’s commitment to dismantling what he deems obsolete and cumbersome remnants of a bygone era in Argentine governance.
