Becoming Self-Employed. The Formalization of Labour Policy in Argentina (1998-2012)

POBLETE, LORENA

Turku

Congreso; 1º Interdisciplinary Conference on Work.; 2013

University of Turku

In 1998, as part of the Tax Reform, the "Single Regime for Small Taxpayers" was created, known as "Single Tax Regime". This regime seeks mainly to formalize the activities of independent workers engaged in low productivity activities (e.g.temporary workers, domestic workers, peddlers, rural labourers). Most of them work in unregistered activities. The incidence of informality in this group of workers was always very important (more than 50%). In order to increase their formalization and to guarantee their access to the social security system, a single unified tax called monotributo was established. And, for the first time, the self-employed workers´ security system includes health insurance in their benefits. In the years following the implementation of this regime, many informal independent workers registered their activities but not all of them had access to the social security system because not all were able to pay social security contributions. This means that the formalization of their labour status dit not reduce their vulnerability against some social risks. Also, the application of this regime has a completely unexpected consequence. This legal status was used as a toll to increase labour flexibility, even in highly regulated labour markets such as public employment. The aim of this paper is to analyse the impact of the "Single Tax Regime" in the cases of domestic workers and rural labourers. I will particularly focus on theses cases in order to analyse the impact of the formalization of low-income independent workers. Domestic workers an rural labourers, when they register their activities in the "Single Tax Regime", they became self-employed workers. However, by the type of work they do, they can not assume the responsibilities of self-employment. They appear as a particular case of "dependent self-employed workers". The aim of this paper is to analyse the consequences of this position for domestic workers and rural labourers. This work is based on analysis of regulation and public statistics.