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Argentina's President Javier Milei says he will reform the Argentine tax system to have no more than 6 taxes.
In a clip from an interview with Forbes Argentina, published on Sunday, Milei said: "We'll advance privatization, deepen labor reforms, and eliminate 90% of taxes — not revenue, but the number of taxes — moving to a simplified system with no more than six taxes at most."
It would be the latest sweeping move by a firebrand president who has inspired members of the incoming Trump administration.
Since taking power on December 10, 2023, Milei has presided over sweeping cuts. He fired tens of thousands of public employees, shut down half the country's 18 ministries, and reduced state spending by an estimated 31% in his first 10 months alone — making good on his pledge to take a "chainsaw" to the state.
Milei's actions caught the attention of Elon Musk and Vivek Ramaswamy, the men now charged with a similar task under President-elect Donald Trump.
Last month, Musk said Argentina had made "impressive progress,'" while Ramaswamy said that the US needed "Milei-style cuts on steroids."
In the interview, Milei said his administration had only accomplished the "first step" of its plan, and that what was coming next was the "deep chainsaw."
"It is not only a question of deregulating and removing these obstacles, but it also implies a new reform of the state to make it even smaller," he said.
Milei added that his administration has so far only implemented a quarter of the reforms it wants to pursue.
Argentina's latest economic figures suggest the country may be turning a corner after struggling economically.
Argentina's inflation dropped from 25.5% in December 2023 to 2.4% in November 2024. However, unemployment rose to 6.9% in Q3, from 5.7% in the same period last year.
Economic activity, meanwhile, grew 3.9% in Q3, compared to Q2.
According to BBVA projections, Argentina will achieve a fiscal balance in 2024 for the first time in 15 years. It also said that it expects Argentina's GDP to rebound strongly next year, from a 3.8% deficit in 2024 to 5.5% in 2025, driven by investments and private consumption.
However, Facundo Nejamkis, director of Opina Argentina, a political consultancy firm, told Reuters this month that Milei's cuts had ignited a "major" recession, and according to Argentina's statistics agency, the country's poverty rate rose to 52.9% in the first half of 2024, the highest rate in 30 years.
Speaking at an event at Argentina's Chamber of Commerce and Services last month, Milei said the recession was "over," after the country had gone through "a difficult period of effort and pain."
And in an episode of the Lex Fridman podcast last month, Milei advised Musk and Ramaswamy to go "all the way" in cutting US federal spending.
Reacting to Milei's latest interview on X, where he talked about eliminating the taxes, Musk wrote one word: "Impressive."
