Monday , January 25 2021

They warn that informality has grown in small and medium-sized enterprises due to high financial costs and tax pressure



President of Industrial Pimes Argentinos (IPA), Daniel Rosato, warned by the excessive growth of the informal market among producers of production, with direct consequences in the employment of the sector and blamed the harmful effect that in the private sector creates a combination of a financial policy that applies high interest rates and a record tax pressure that deprives competitiveness of domestic products.

"The amount of unregistered transactions has risen in a shocking way, because financial costs have forced many companies to operate only in cash, to avoid price rises and do not have to change controls that generate losses that are not logical," he stressed. Rosato.

An industrial warning warns that the decision of "many small and medium-sized enterprises" to act part of their production outside of formalities creates significant losses in the vault and puts competitive weakness on registered companies that "face daily the payment of all obligations because they are part of the system", as happens those associated with IPA.

In this regard, Rosato criticized the unregistered sale, although he tried to explain that the installation of informality on the commercial market "responds to the problems caused by the recession crisis, with a deadly reduction in domestic consumption, higher costs determined by an increase in energy prices and a devaluation that has distorted the entry market" .

"Lack of funding and strong tax pressure are combined to make the SMEs a painful decision: they become informal. No one who has reached the recognition situation in the virtual circle of the economy wants to leave the situation, but the only way to avoid is increase and may be able to buy spare deliveries without uncertainty in cash prices because the banks have the minimum margin of profitability they're dealing with at the moment, "Rosato complained.

The calculation of IPA shows that informality uses the manufacturer with an average reduction of 20% in the prices of its products. These offers are passed on to informal markets such as fairs, even in commercial areas offering discounted prices, as they sell some of their sales in black.

"Mechanisms of the force of economic policy and the strengthening of the black market, since the interest rates are high and check the delay is expensive, manufacturers and traders are leaving the formal market to trade in cash because of the loss of competitiveness, it is generated in the financial sector," Rosato said.

The IPA president said he was discovered "the transition from formal to informal market, which is emphasized with greater emphasis in the interior of the country," although he understood the reasons behind the company's avoidance of formalities, he regrets that "the logic of disloyalty in competitiveness between those companies remaining in the tax system from those who choose to switch to informality of having minors' costs."

"It is essential that the national government takes into account this situation and establishes a comprehensive plan for an industrial SME that devises interest rate cuts, financial resources to encourage domestic production and re-conquer the domestic market, thereby avoiding the informality of companies moving, as it happens today , an increase in work that is not registered, as this suggests that the future is all fragile for all Argentines, "Rosato confirmed.


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