Export tax defeat a setback for Argentine leader

BUENOS AIRES, Argentina (CNN) -- With Argentina's vice president casting the deciding vote, the country's Senate on Thursday narrowly defeated an increase on an agricultural export tax, which has provoked months of farmers' rebellion.

After more than 17 hours of debate, the Senate voted twice, with both ballots resulting in a 36-36 split. Vice President Julio Cobos broke the tie, voting against the measure.

The vote was a blow to President Cristina Fernandez de Kirchner, who imposed the tax on March 11 without consulting Congress. In a concession to her critics, she said last month that she was sending the measure to Congress to debate. Her supporters control both houses in Congress.

At the time of the Senate's vote, the lower house, the Chamber of Deputies, already had approved the increase.

"This doesn't mean that I am betraying anyone," Cobos said. "I am acting according to my convictions."

The 44 percent export tax -- which applies to soybeans, wheat, corn and sunflower seeds -- is the cause of a four-month-old standoff between the government and farmers.

Fernandez has argued that the tax pays for government increases in senior citizens' pensions and help for the poor, and she has rejected the farmers' demand for a repeal of the export tax as "extortion."

Argentina is the world's second-largest corn exporter and third-largest soy bean supplier. The farming sector is widely credited with helping the country rebound from a devastating economic crisis in 2001.

Farmers sporadically have cut off transportation routes in the country over the past four months in an effort to hit the government's coffers.

In those cases, food that normally ships to Europe and Asia has not made it to port.

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