Buenos Aires Herald 
The Lower House gave President Javier Milei his first major win early Friday morning by stamping final approval on his flagship reform project known as the Ley Bases and the fiscal package. The government also managed to reinstate a lower income tax threshold and cuts to personal asset tax that the Senate had rejected, two issues that were in fierce dispute as they raised taxes for the middle class and lowered them for more affluent sectors.
The president celebrated the win, calling the Ley Bases “a historical and monumental landmark in Argentine history.” “It’s five times the reform [former President Carlos] Menem did, which was the biggest one so far,” he said in an interview with TV network LN+ on Friday morning, adding that the approval marks the beginning of a “new chapter.”
“We’ve passed the stage of zero deficit. Now we are entering the phase of zero [monetary] emission, a change in the monetary regime,” Milei explained. He also stated that Federico Sturzenegger, one of the economists in charge of drafting the president’s December mega-decree and the Ley Bases, will officially become part of his administration sometime next week to head what the president called “structural reforms to gain economic freedom.”
The presidential press office published a statement on X applauding the approval, calling it a “significant step forward” and congratulating legislators for their “patriotic duty.” The release also reiterated Milei’s call to provincial governors and political leaders to sign the pact he announced in the opening session of Congress to “eliminate misery from Argentina’s future and embrace the idea of freedom.”
The pact was originally going to be signed in Córdoba on May 25, a public holiday commemorating Argentina’s 1810 Revolution. That day was scratched pending approval of the Ley Bases, a non-negotiable condition for the event. Following Senate approval, Milei said that the pact would now be signed on July 9, when Argentina will celebrate its 1816 Declaration of Independence.
The Ley Bases
Since both chambers had already approved them, the Ley Bases and the fiscal package were guaranteed to become law after Thursday’s session. Deputies could only approve or reject Senate changes but not make any more modifications to the text.
After more than 12 hours of debate, deputies passed the changes the Senate made to the Ley Bases a little over two weeks ago with 147 votes in favor, 107 against, and 2 abstentions. Lawmakers in the Upper House had reduced the number of state-managed companies set to be privatized, maintained a pension moratorium the government wanted to eliminate, and made changes to the legislation known as RIGI that looks to incentivize large investments in the country.
The final text of the Ley Bases grants Milei legislative powers over administrative, economic, financial, and energy-related issues for one year, as well as the ability to close or restructure certain public organizations (the Senate removed institutions related to science and technology from this list).
The law also enacted a labor reform that extends the probation period from three to six months and makes company takeovers and “blockages” — preventing the company from operating properly as a form of protest — a fireable offense.
The fiscal package
While the Ley Bases was debated as a whole, as was decided in commissions, several aspects of the fiscal package were set to be voted on individually. Among its most significant features are a fiscal amnesty and a tax moratorium, but ruling coalition La Libertad Avanza (LLA) was insistent on reinstating certain aspects of the original text approved by the Lower House in April. Specifically, installing a lower income tax threshold and applying cuts to taxes on personal assets.
Although there was some uncertainty about whether the UCR would back the government’s idea, the income tax chapter was passed with 136 votes in favor and 116 against. People with monthly salaries of AR$1.8 million (US$1936 at the official rate and US$1,351 at the MEP rate) will now have to pay some amount of income tax.
The raising of the personal asset threshold at which a person would begin getting taxed was also approved by 134 votes to 118. The bar was increased from AR$27 million to AR$100 million, and the tax rate was also lowered.
Cover picture by Mariano Fuchila
