A detail of a can of Coca-Cola is seen in London, Britain March 16, 2016. Photo: REUTERS/Stefan Wermuth
Coca-Cola Co (KO.N) may withdraw part of a $1 billion investment in Argentina due to concerns over a government proposal to raise taxes on soft drinks, newspaper El Cronista reported on Friday.
The U.S.-based company had pledged $1 billion over four years in January 2016, one of the first major investment announcements made after business-friendly President Mauricio Macri took office.
Citing anonymous company sources, Cronista said Coca-Cola was also considering halting purchases of concentrated juice from Argentine citrus producers.
Coca-Cola representatives in Argentina and the United States did not immediately respond to request for comment.
The proposal to raise sales taxes on soft drinks to 17 percent, from up to 8 percent previously, came as part of a broader tax reform Macri’s administration presented last week. The reform aims to drastically cut corporate income taxes, but raises taxes on some consumer goods to offset revenue losses.
On Thursday the government agreed to ditch a proposed tax on wine after vineyards complained the measure would cripple wine production.
The tax proposal will be presented to Congress on Monday.
