Recycling: six keys to the new project that will be submitted to Congress

The government has relaunched a extensive money laundering in the tax package that will be sent to Congress together with the new draft Bases Law. After the failure of a previous initiative last February, the new mechanism provides for the payment of progressive rates from 0 to 15% and the possibility of regularizing undeclared assets exceeding 100,000 dollars without paying the special tax, in exchange for compliance with certain conditions.

These are the main keys to the initiative:

1) Who does money laundering affect?

Residents and non-residents can outsource activities in Argentina and abroad. The tax to be paid will be in dollars and will be calculated on the basis of the overall value of the assets that are regularized through this regime, according to a mechanism of progressive rates and decreasing benefits, although those who satisfy certain requirements may also be exempt from the tax, regardless of the amount they pay. earn.

2) How much do you have to pay?

The project establishes that the heritage up to US$100,000 will have a rate of 0%., while for larger amounts you will pay increasing rates depending on the period in which they enter. In the first phase, which will last until 30 September 2024, the rate on the surplus will be 5%; in the second phase, until 31 December 2024, it will be 10%; and in the third, until 31 March 2025, 15%.

3) What are the exceptions?

The regime provides for “special exclusion subjects” from paying the tax. So, the Deposited amounts exceeding US$100,000 will also not be paid said tax provided that the funds remain deposited in special accounts of the Argentine financial system until December 31, 2025, or are allocated to “financial instruments” to be defined by the Executive.

4) What can be regularized?

For goods in Argentina, cash in pesos or dollars. Real estate, stocks, shares and interests in companies, rights of beneficiaries of trusts or units of mutual funds, bonds, negotiable bonds, certificates of deposit in custody, credits of every kind and nature, rights and other intangible assets and credits. Assets abroad are also included cryptocurrencies.

5) Do I have to pay other taxes?

Unlike taxpayers who fulfill their obligations, those who regularize undeclared assets will be freed from any civil action and for tax, currency, customs and administrative infractions, as well as from they will be exempt from paying taxes which had not been recorded (Profits, internal taxes, VAT, personal assets and the extraordinary contribution, called capital tax).

In case of Gross Income, is different because it is a provincial tax and will depend on the provinces that join the scheme. This way, if, for example, Córdoba decides not to participate and obtains information from a taxpayer who receives income from assets not declared to the scheme, the province could demand payment of the gross income for the omitted sales.

6) Why are they launching a new whitewash?

The government seeks to increase reserves and collection under the agreement with the IMF to achieve a fiscal surplus in 2024. It is estimated that the fiscal package could contribute $2.5 billion (0.5% of GDP ) through the reinstatement of the income tax. Employee profits and resources obtained from recycling and advances of personal assets, with tax benefits being granted to higher income sectors.

The project became known last night after the President raised the need for more facilities to launder undeclared funds. “That 50 thousand dollars can be used without problems seems like a good thing to you. If they want you to use 50 green sticks, I don’t give a damn (…) We will have to do more flexible whitening so that they can whiten,” Javier Milei said in an interview with Neura on Monday.

Argentina had already done it at least seven closures since the return of democracy. Cristina Kircher’s management did this for $4.7 billion in 2009 and $2.6 billion between 2013 and 2015. Mauricio Macri regularized $100 billion and Sergio Massa promoted a money laundering scheme in the construction sector. In most cases the collection represented no more than 5% of what was declared.