Argentine President Cancels Tax Exemptions for Cryptocurrencies
In a recent move, Argentine President Javier Milei, along with Economy Minister Luis Caputo, has eliminated proposed tax exemptions for cryptocurrencies, altering an important aspect of the “Bases and Starting Points for the Freedom of Argentines” bill. This decision marks a significant departure from Argentina’s previously favorable stance towards Bitcoin and digital assets.
Pro-Bitcoin President Milei Removes Tax Exemptions
According to reports by Argentine tech-focused outlet iProUP, the original version of the bill included a clause for asset regularization, which suggested imposing a one-time tax on undeclared assets, including cryptocurrencies.
The tax provisions of the bill aimed to allow Argentine citizens to disclose ownership of previously unreported assets, such as cryptocurrencies. The first $100,000 in value would have been subject to a 0% tax rate, while assets exceeding this threshold would have been taxed at up to 15%.
However, President Milei and Minister Caputo decided to remove this part of the bill on Friday. Guillermo Francos, the Minister of the Interior, explained that it was causing delays in the legislative process.
Francos stated that the focus of the Bases Law is to promote economic development and generate freedom. Removing the tax section was deemed necessary to expedite this objective.
Crypto Taxation in Argentina
The removal of cryptocurrency tax exemptions has sparked discussions about the current tax regime applicable to digital assets in Argentina. Marcos Zocaro, an accountant, clarified that the main taxes that cover cryptocurrencies are Earnings and Personal Property taxes. Zocaro explained that individuals are not taxed simply for buying digital currency; instead, they are taxed on profits made from selling them.
Sebastián M. Domínguez, director of SDC Asesores Tributarios, emphasized the need for taxpayers with cryptocurrencies to declare them if their assets exceed the legally established amounts. He noted that the treatment given to cryptocurrencies for tax purposes is based on their acquisition cost.
Maria Inés Brandt, from Marval, O’Farrell & Marval law firm, outlined the taxation process for the sale of Bitcoin and cryptocurrencies. She explained that individuals resident in Argentina must pay a 15% income tax on the income derived from selling cryptocurrencies. For companies, profits are taxed at a progressive rate of 25% to 35%, depending on the subject, plus 7% for potential dividend distribution.
President Milei’s Policy Change
This policy change under President Milei’s administration, known for its libertarian economic approach, signals a shift towards a more conservative stance on regulating and taxing digital assets. Samson Mow, Bitcoin advisor to El Salvador’s President, had previously planned to meet with Argentina’s “pro-Bitcoin” president Milei to discuss integrating BTC into Argentina’s economic framework.
Milei emerged victorious in Argentina’s 2023 presidential election and has expressed his support for Bitcoin in the past. However, since assuming the presidency in December 2023, he has remained silent on Bitcoin-related matters.
Hot Take: Argentine President Cancels Tax Exemptions for Cryptocurrencies
Argentine President Javier Milei has made the decision to eliminate proposed tax exemptions for cryptocurrencies, shifting away from the country’s previous pro-Bitcoin stance. This move has sparked discussions about crypto taxation in Argentina and raised questions about how digital assets will be regulated in the future. President Milei’s decision reflects a more conservative approach to digital asset regulation and taxation, in contrast to his earlier support for Bitcoin. It remains to be seen how this policy change will impact the cryptocurrency ecosystem in Argentina and whether it will hinder or promote its development.
By
By
By
By
By