A local CEO explains why the tech monotribute is a bad measure

Less than a day ago, Deputies gave half a sanction to the official project of “Mono tech”, the monotribute designed so that those who work in the freelance modality of the Knowledge Economy sector can enter their dollars in a legal and traceable way.

From the official point of view the goal is clear: integrate this multiplicity of workers who provide services abroad on a freelance basis, to the tax regime, so that You will be able to declare your income, although it must not exceed $30,000 per year.

However, for Gustavo Guaragna, a businessman/entrepreneur from the Tech world with more than 30 years in the sector, the initiative is far from being positive, on the contrary, it could generate more complications. “For the worker it is bad because progress is made in informality; SMEs will lose competitiveness when negotiating with their employees, for example, and for the State the collection will be less than what these profiles could add if they work in local companies”, detailed a PROFILE. A whole combo that slowly began to crumble.

Technological monotribute: who would benefit from this new figure?

Profile of an entrepreneur in the sector

In his talk with PROFILE Guaragna clarified that Opinions are personal in his role as CEO of Snoop Consulting, the 23-year-old firm he runs today. As a central point of his disagreement, he pointed to the labor informality that the project encourages, within a sector that is mostly “formalized.”

“I see it badly for the workers because is promoting a sort of ‘job precariousness’, in a sector such as software that has a very high level of formality as a result of the legislation of the last two decades that will consolidate a formal framework for the knowledge industry”, he said.

To put figures, adequate that the sector currently has a payroll of about 150 thousand employeesof the rights approximately 10% (15,000 to 20,000 workers) ran towards informalityas a product of the disadvantage that charging in official dollars entailed.

“To those 15 or 20 thousand who are independent today, this relief brings them, but not a genuine job because it is not in the same regulations as someone who works in a local company,” he said.

A local CEO explains why the crisis of global technologies would help Argentina

“Secondly, companies will be affected, especially SMEs, because they do not have access to dollars to be able to remunerate their employees in that currency,” Guaragna explained, adding that “even if they did, they are at a disadvantage because the tax burden that formal employment has in Argentina is between 35 and 50% above what a worker receives in pockets. And here we are not talking about low wages,” he said.

“These 30,000 dollars a year that the freelancer will be able to invoice under this regime would be something like 2,500 dollars a month of free availability. We are talking about out-of-pocket salaries of close to 1 million pesos,” he explained. And he added that the work in this sector usually has continuity and extends over time.

“Usually they are 6-month or one-year contracts, but they are about foreign legislation, with which that adds a new competitive disadvantage to the local industry”added.

Finally, on March 28, Deputies gave a half sanction to Monotributo Tech

This leaves local SMEs in a huge inequality in a very competitive market abroad. Today it is part of the trend to eliminate intermediaries, and in this sense the economy that is going to arbitrate in this sense is going to be the platforms. Somehow this is carrying out the economy of Rappi or Uber to an economy that -in general- does not need it, although there are exceptions, like these people who were outside the sector.

In addition, Guaragna ratified the difference. “It is not that the person is going to work for a foreign company, but that he is going to do a job for a foreign company, almost within the framework of informality.”

“To this is added that, in my opinion, the added value generated when creating a local project is much greater than when working as a freelance for specific tasks,” he added.

As for the third leg, state revenue, The tech entrepreneur recalled that what the State manages to collect with this measure will not be so interesting either, quite the contrary.

“In Argentina, what is going to enter the State is less than 3%. If the person already maintains a part-time job -both in the State and in a company-, they will no longer pay the monotribute that will enter more money to social works because the Law so indicates. With which, what is going to enter the State is that 3%. For a salary of 1 million pocket pesos, only 4th category Earnings would be receiving around 300 thousand pesos per month and here they would enter entering 30 thousand pesos. It is a huge distortion, “he added.

Finally, Guaragna rounded off: “In my view, I could be wrong, but I think that the project is bad for the worker due to job insecurity; it will leave SMEs in a very bad situation to retain talent and for the State, it will to be bad, because the collection will be complicated”; complete.

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