The Argentine government aims to pass the 2026 Budget during an extraordinary legislative session between December 10 and 31. To achieve this, the ruling party needs the support of provincial governors. Although the 'La Libertad Avanza' coalition and its allies hold 115 of the 257 seats in the Chamber of Deputies, they still lack the necessary votes to pass this key initiative. Therefore, the Minister of the Interior, Diego Santilli, is holding meetings with governors to secure agreements. The governors' main demands include a new distribution scheme for Automatic Tax Transfers (ATN) and the fuel tax, government guarantees for debt to fund public works, and additional resources to cover the deficit of provincial pension funds. According to the budget draft, provinces will receive 7.7 trillion pesos in 2026 through federal coparticipation and agreed-upon programs. However, governors are requesting more resources. Another point of contention is the funding for the deficit in pension funds: the government has allocated 122.7 billion pesos, which governors claim is only half of what is needed. Discussions are also ongoing regarding the distribution of the fuel tax, which is projected to raise 7.6 trillion pesos. Governors had previously sought to secure 52% of these revenues, but the bill was rejected in the Chamber of Deputies. Currently, 10% of the tax goes to the provinces, with the rest going to the national treasury. Additionally, governors are requesting that the budget include funding for infrastructure projects in their provinces and provide guarantees for taking on debt for these purposes.
