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Argentina Senate rejects farm tax Argentina Senate rejects farm tax
(30 minutes later)
The Argentine Senate has narrowly rejected controversial tax increases on agricultural exports that have provoked repeated protests by farmers.The Argentine Senate has narrowly rejected controversial tax increases on agricultural exports that have provoked repeated protests by farmers.
With senators tied 36 to 36 after 18 hours of debate, Vice-President Julio Cobos cast the deciding vote to reject the government's proposals. With senators tied 36 to 36 after more than 16 hours of debate, Vice-President Julio Cobos cast the deciding vote to reject his government's proposals.
The outcome is as a blow to President Cristina Fernandez, correspondents say.The outcome is as a blow to President Cristina Fernandez, correspondents say.
Farmers said the taxes would be crippling, but the government said they were needed to fight poverty.Farmers said the taxes would be crippling, but the government said they were needed to fight poverty.
Earlier this month, the lower house of Congress passed the measures and it is not clear what steps the government will now take. May history judge me, my vote is not for, it's against Julio CobosArgentine vice-president
Farmers have won a critical battle but the dispute is not over and Argentina faces some tough days and weeks ahead, says the BBC's Daniel Schweimler in Buenos Aires.
The government has said that it will seek another vote in the lower house, which passed the measures earlier this month.
Food pricesFood prices
Mr Cobos, who is also leader of the Senate, said it had been "the most difficult day of my life".
Close to tears, he cast his deciding vote.
"They tell me I must go along with the government for institutional reasons, but my heart tells me otherwise. May history judge me, my vote is not for, it's against," he said.
Farmers and government supporters held rival demonstrations
In a Buenos Aires park, hundreds of farmers and their supporters erupted in cheers after watching the vote on big-screen televisions.
Argentina is a major producer of soya, grains and beef, which fetch high prices on international markets.Argentina is a major producer of soya, grains and beef, which fetch high prices on international markets.
The dispute began in March when President Fernandez's government raised taxes on soya exports from 35% to 45% and imposed new taxes on other farm exports. The dispute between the government and farmers began in March, when President Fernandez's government raised taxes on soya exports from 35% to 45%, and imposed new taxes on other farm exports.
The government argued that this was a way of redistributing the wealth resulting from the worldwide boom in food prices to poorer Argentines. The government argued that they needed to raise taxes on agricultural exports to help build a new Argentina.
Farmers' leaders said the new taxes would cripple the rural economy. It said farmers could afford to pay more, as they were benefiting from high prices.
The authorities also accused farmers and their supporters of undermining democracy by refusing to respect the wishes of the elected government.
However, farmers' leaders said that any profits needed to be reinvested so that Argentina, one of the world's leading agricultural producers, could help to feed a hungry world.