The monotributo, a tax regime that was once intended as a temporary solution for small businesses and self-employed workers, has become the elephant in the room in discussions about the sustainability of Argentina’s pension system.

The regime’s main problem is its lower tax burden compared with that of a system that covers employees in dependent employment. This means lower state revenue and poses a significant challenge for the future of the pension system.

According to a study by conservative think tank Fundación Mediterránea, workers in the lowest monotributo categories barely cover a fraction of the pensions they would be entitled to.

In fact, even the highest-earning monotributo workers fail to contribute enough to cover the lowest pensions.

This is a problem that will only grow over time due to Argentina’s rapidly aging population, which will put its pension system under increasing pressure unless changes are made.

The birth and expansion of the monotributo

The Simplified Regime for Small Taxpayers (Monotributo) was created in the late 1990s. Its goal was........

© Buenos Aires Herald