Confiscatory farm taxes approved in Argentina

BBC:

Argentina's lower house of Congress has approved a controversial package of taxes on agricultural exports.

Farmers are strongly opposed to the measures and have staged widespread protests over the past four months, resulting in riots and food shortages.

They had threatened to renew roadblocks if the measures were approved.

Argentina is one of the world's top producers of soya, grains and beef and the government wants a bigger share of the profits, it says to fight poverty.

Farmers say such high taxes are crippling.

The vote of 129 to 122 came after a heated 17-hour debate in Congress. The Senate is due to consider the measure in coming days.

The BBC's Daniel Schweimler in Buenos Aires says the country is now waiting with bated breath to see whether farmers will accept the vote, which most commentators say is unlikely, or start rebuilding their roadblocks.

...

I don't see the farmers giving in on this. The taxes are bad policy that will give farmers less incentive to produce and export their products. They are a taking from the productive for the benefit of the unproductive. It is a double disincentive. Those who are not working will have less incentive to do so and those who are working will have less incentive to produce more.

The Kirchner governments screw the farmer policy is a huge mistake that is hurting the Argentine economy and contributing to the food shortage around the world. She is destabilizing the country causing money and capital to flee to areas where a greater return is available.