Argentina’s lower house of congress has given the green light to state reform and tax packages proposed by President Javier Milei, marking a significant legislative win for the libertarian leader in his push for lasting change.
In a vote of 142 to 106, with five abstentions, lawmakers approved the state reform bill, endorsing measures including incentives for major investments, easing labor market regulations, and potential privatization of some state-owned enterprises.
The tax bill, which includes reinstating income tax for high earners and a broad tax amnesty, passed with 140 votes in favor, 103 against, and six abstentions.
Milei hailed the approval as a crucial step towards pulling Argentina out of its longstanding economic challenges, emphasizing the need for austerity and deregulation.
Despite his party’s minority representation in congress, Milei has struggled to secure support from opposition parties, relying heavily on executive powers to implement reforms.
Analysts note the significance of Milei’s ability to garner support from moderate opposition factions, underscoring his pragmatic approach in navigating the political landscape.
However, challenges remain as the bills head to the senate, where Milei’s party holds a minority of seats. Winning over members of the opposition will be crucial for their passage.
The tax measures are expected to bolster the government’s fiscal position and restore lost income to provinces, addressing pressing concerns for regional governors.
Milei’s willingness to compromise, evidenced by the removal of contentious provisions from the reform bill, reflects a more pragmatic approach aimed at building consensus.
With the legislative hurdle cleared, Milei intends to rally supportive governors for a national pact on May 25, signaling a commitment to broader economic and state reforms.
