The Argentinian government has recently made amendments to money laundering laws to provide tax exemptions for citizens who declare up to $100,000 worth of Bitcoin and other tokens. However, the tax exemption only applies to those who hold their cryptoassets on government-registered exchanges and wallet providers. This change may pose challenges as many citizens use virtual wallets that are not registered with the National Securities Commission (CNV).
In addition to the requirement of using registered platforms, the valuation of tokens must be based on market rates as of December 31, 2023. Alternatively, taxpayers can use the acquisition value if it is greater than the market rates specified. This could be problematic for those holding stablecoins like USDT, as their market value is much higher in Argentina due to foreign currency buying caps and hyperinflation.
Failure to comply with the new law will result in criminal penalties. These measures were announced in a Fiscal Package unveiled by President Javier Milei, who aims to regulate the crypto sector more effectively. The new regulations come in response to recommendations by the Financial Action Task Force to prevent money laundering and terrorist financing.
Although declaring their tokens will exempt Argentine crypto holders from a special tax on undeclared assets and earnings, they will still have to pay taxes on their coins. The Economy Minister Luis Caputo stated that citizens can avoid special tax levies by moving their coins into the Argentine financial system and not withdrawing them before December 31, 2025.
Moreover, similar protocols have been unveiled for citizens who hold US dollars and other foreign currencies. Those who fail to file declarations could face tax bills ranging from 5% to 15% of their tokens’ dollar value. President Milei has expressed his support for Bitcoin but is focused on dollarizing the Argentine economy and combating money laundering and tax evasion.
In conclusion, the recent amendments to money laundering laws in Argentina provide tax exemptions for citizens who declare their crypto holdings up to a certain value. However, strict requirements such as using government-registered platforms and valuing tokens based on specific market rates may pose challenges for crypto holders. Compliance with the new regulations is essential to avoid criminal penalties and hefty tax bills, as the government strives to strengthen regulation in the crypto sector and curb financial crimes.
