Mercado Libre left an Argentine city due to massive municipal taxes: how it will continue operating

Mercado Libre announced the closure of its offices in the city of Córdoba starting in August . The decision was made after several months of unsuccessful negotiations with local authorities over the high cost of municipal taxes , which the company considers "disproportionate."

The company explained that, despite the closure of the physical space, there will be no layoffs and that the more than 1,200 employees will continue working remotely. They indicated that in Córdoba, they pay $770 million monthly in municipal taxes.

"The amount is completely disproportionate to the company's activity and the size of its team and office in the Cordoba capital," the Argentine unicorn criticized.

He added that it has the "highest municipal tax rate compared to other localities with similar operations" and questioned the fact that it is not reflected in service improvements: "There is no equivalent compensation in infrastructure or services to justify such a burden."

The e-commerce platform stated that the decision was made after months of discussions with local authorities and emphasized that the service will continue to operate normally without staff reductions, maintaining the 1,260 employees.

“Starting in August, employees, most of whom work in technology, will continue to work remotely while medium-term alternatives are evaluated,” they explained.

In this regard, the president of Mercado Libre Argentina, Juan Martín de la Serna, spoke out against the measure promoted by the town headed by Daniel Passerini.

“In Córdoba City, we pay $770 million a month in municipal taxes, the highest amount in the country! After exhausting all other options, we left our offices and went 100% remote. Incredible, but true,” de la Serna noted.

Prior to the closure in Córdoba, Mercado Libre had announced a commission increase in provinces with higher gross income taxes than the general average.

Starting July 8, sellers will be charged fees ranging from 8% to 20.5% for each sale, depending on the product category and the desired exposure for the listing.

The provinces that will be subject to this increase include Córdoba, Santa Fe, and Jujuy , where the Gross Income tax is above the provincial average (between 6.75% and 9%).

Corrientes, Río Negro, Santa Cruz, Formosa, and Santiago del Estero will receive reductions , as they receive below average wages (between 2.9% and 3%). In the remaining provinces, the rates will remain unchanged.