New Tax on Bitcoins in Argentina

Legislators in Argentina are analyzing a law to tax cryptocurrencies. This tax will be applied to users and exchanges. The basic idea is to apply the Income Tax on operations made by virtual currencies, both to companies and to individuals. Cryptocurrencies are considered a digital value representation, and they are a means of exchange, a unit account, and/or an investment vehicle.

The tax on cryptocurrencies in Argentina will be applied in the following four cases:

1) Commission Agent. It is defined as the person who acquires cryptocurrencies on behalf of another person and obtains a commission in return. However, they do not perform this service on a regular basis.

2) Exchanges. These are the exchange platforms devoted to buying and selling cryptocurrencies.

3) Traders. They provide this service frequently. Their annual income is below 15 million.

4) Other users. By selling cryptocurrencies, they are subject to a tax of 0.25% when their profit comes from the commercialization of goods and services. For example, those businesses and freelancers that receive their payments from abroad.

However, experts anticipate possible consequences regarding the passing of the tax law on cryptocurrencies in Argentina. For instance, informal transactions will increase. In addition, the “blue” bitcoin will be more expensive than the official type, since it will not be reported to AFIP [Federal Administration of Public Revenue]. These experts also agree that this is actually a double tax since it will be applied upon buying and retrieving cryptocurrencies. Most importantly, it will affect mostly beginner users.

On the other hand, the perspective of the industrial sector is worth noting. First, they are in favor of the project for the creation of a Chamber of Crypto Companies. Also, they see the need for a regulating framework that promotes the cryptosystem in the country. However, they think that this new tax would force professionals and companies to leave the country. Another negative consequence would be the loss of potential foreign investments.
Moreover, the underlying question is: who should be the withholding agent, the company or the person? Nevertheless, everybody agrees that this tax will certainly affect the final price.

According to experts, this will lead to the increase of operations on P2P (Person to Person) platforms, which operate by linking buyers with sellers, below the control of controlling agencies and without having to pay taxes.

By Limeres Attorneys, Argentina
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AUTHOR: Limeres Attorneys

Copyright Limeres Attorneys

Disclaimer: Every effort has been made to ensure the accuracy of this publication at the time it was written. It is not intended to provide legal advice or suggest a guaranteed outcome as individual situations will differ and the law may have changed since publication. Readers considering legal action should consult with an experienced lawyer to understand current laws they may affect a case. For specific technical or legal advice on the information provided and related topics, please contact the author.

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