Argentina, South America’s second-largest economy, is undergoing significant change under newly elected President Javier Millais. Milei introduces a bold new proposition for cryptocurrency holdings. The focus of this proposal is to require citizens to declare all cryptocurrency assets both domestically and internationally.
The bill has sparked controversy because of its innovative approach to ensuring compliance. Preferential tax rates are offered to those who report domestic and foreign cryptocurrency assets before the March 31, 2024 deadline. However, this ratio is expected to increase significantly and reach 15% after November 30.
Miley’s Unconventional Economic Approach
Milei is known for its dynamic and unorthodox economic strategies. This cryptocurrency draft bill fits into his broader economic and political reform agenda. One of the key features of the bill is the Asset Normalization Program, which aims to bring various assets, including cryptocurrencies and crypto-assets, into the formal economy. This program reduces penalties for those who disclose assets prematurely. For example, citizens who comply before the March 31 deadline will only be subject to a 5% tax rate, rising to 15% at the end of November.
Universal application for cryptocurrencies and digital assets
The bill’s provisions apply universally to “cryptocurrencies, cryptocurrency assets and other similar instruments,” regardless of their issuer, owner or storage location. This is part of efforts to legalize the use of digital assets in Argentina and promote their normalization and integration into the formal economy.