Cristina Kirchner declines the the tax treaty with Spain

Argentina, July 14, 2012

The measure is interpreted as a message of hostility to Spanish and foreign investment. “

This is the head of the Spanish newspaper ABC and the article says that:

‘Three months after the intervention and expropriation of Repsol YPF, the Argentine government decided to break the double taxation treaty between Spain and Argentina. The measure is interpreted as a message of hostility to Spanish and foreign investments. It also translates into a higher tax burden for companies and physical characters. That in economic terms but politically, is a further blow to the battered relationship between Cristina Fernandez de Kirchner and Mariano Rajoy”. The aforementioned agreement between the two countries ruled for twenty years.

From the Embassy of Spain, according to sources at the embassy, they are making “every effort” to avoid an unilateral rupture. However, the political decision was made. The measure takes effect from January 1, 2013. Today was published in the Official Gazette.

A Spanish executive illustrates some of the scenarios that the Spanish capital investments can be found from January: “There will be cases where we have to pay twice for the same concept, in Spain and Argentina. Our costs will increase a lot. ”

The move comes after Repsol YPF was expropriated by Kirchner 24 hours later the meeting the president, Cristina Fernandez de Kirchner had with the Minister of Economy Luis de Guindos.