“Bitcoin Tax”: Argentine Economy Minister will present a project to launder cryptocurrencies and reach them with taxes

Argentine Economy Minister Sergio Massa is desperate to increase collection, and his economic team has prepared a proposal for him to achieve various taxes on all types of financial assets, including Bitcoin and other cryptocurrencies.

From the Palacio de Hacienda, they are preparing the presentation of a bill that seeks to encourage (and extort) the declaration of assets and financial assets owned by citizens in Argentina or abroad.

The Argentine Savings Externalization Law seeks that people “voluntarily and exceptionally” declare property or assets as national or foreign currency before the AFIP; financial assets (including stocks, cryptocurrencies, bonds, and securities); estate; furniture; and other goods in the country and/or abroad, including credits.

The declaration of foreign currency does not only imply informing its possession, but the bill intends to establish that these be deposited in banking entities (Argentine or foreign) and be reached by taxes, such as Profits and Personal Assets.

In the Ministry they assure that the legislation will be historic since for the first time they will seek to achieve these taxes on cryptocurrency holdings, which have always managed to escape the clutches of the State.

The bill establishes that those who declare their possessions in the first 90 days will pay a “reduced tax” in Argentina of 2.5%. After that period of time, the amount increases progressively until it reaches a maximum of 10%.

Despite the fact that at some point Kirchnerism spoke of strongly regulating Bitcoin, the purchase and sale of any cryptocurrency in Argentina isn’t illegal, but it does require payment of income tax and, in some cases, personal property.

The income tax payment for this case, which is calculated from the difference between the sale value and the costs and expenses of the operation, should be taxed to be “blank” with the AFIP. If the result of the aforementioned calculation is positive and exceeds the non-taxable minimum ($280,792 for fiscal year 2022, about US$1,556), the person must pay this tax, which rate can be 5 or 15%.

On the other hand, you may also have to pay for personal assets. Although you do not have to pay direct taxes for the purchase of cryptocurrencies, the State takes a cut of their possession through the Personal Assets Tax.

This tax depends on the assets taxed as of December 31 of each year and includes everything from cars, real estate, to the cryptocurrencies themselves. The floor is $2 million (US$110,000) (year 2022) and if the valuation of all this exceeds said minimum, a rate ranging from 0.5% to 1.75% must be paid.

In total, Massa’s plan supposes a reduction of up to 10% for laundering, then a tax that can reach up to 1.75% every year for possession, and finally a tax that can reach up to 15% in if you want to sell them.

With informatin from La Derecha Diario