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ECONOMY | 17-11-2021 15:17

Argentina begins taxing cryptocurrency, reversing old stance

Transactions involving cryptocurrencies will be subject to government's tax on bank credit and debts, effective immediately.

Transactions involving cryptocurrencies are subject to Argentina’s tax on credits and debts (popularly known as the ‘cheque tax’), effectively immediately, the government said in a decree published on Wednesday.

The decree aims to clarify and limit tax exemptions granted to third-party payment service providers and other new types of businesses, which have benefited from the e-commerce boom since the start of the pandemic.

“The exemptions provided for in this decree and in other regulations of a similar nature will not be applicable in those cases in which the movements of funds are linked to the purchase, sale, exchange, intermediation and/or any other operation on cryptoassets, cryptocurrencies, digital coins, or similar instruments, in the terms defined by the applicable regulations," the government said.

Cryptocurrency transactions between individuals were previously considered exempt from the Impuesto sobre los Créditos y Débitos en Cuentas Bancarias y Otras Operatorias de Argentina ("Tax on Credits and Debts in Bank Accounts and Other Transactions") as if they were cash transfers, said Sebastián Domínguez of SDC Asesores Tributarios.

The tax on credits and debts is levied at rates of up to 0.6 percent on all banking transactions, including cash deposits, cheques and wire transfers.

Capital gains earned from transactions involving cryptocurrencies have been subject to income tax since the 2017 reform of Argentina's tax code.

Argentina has seen a rise in cryptocurrency operations in recent years. According to official data, cited by the Noticias Argentinas news agency, at least two million cryptocurrency accounts are open in the country today.

 

– TIMES/BLOOMBERG/NA

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