Argentine Government Sends Major Tax Reform Bill To Congress To Boost Formal Economy And Savings

(MENAFN- The Rio Times) The Argentine government has sent a sweeping tax reform bill to Congress, aiming to overhaul the country's tax regime and encourage citizens to bring their undeclared savings-especially U.S. dollars-into the formal economy.

Officials announced the proposal, called the“Fiscal Innocence Principle Law,” at the Casa Rosada, with the heads of the Revenue and Customs Control Agency (ARCA) and the Budget and Finance Committee outlining its details.

The bill introduces two main changes. First, it significantly raises the threshold for criminal tax evasion. Previously, authorities could pursue criminal charges for undeclared amounts above 1.5 million pesos, about 1,260 U.S. dollars.

The new threshold jumps to 100 million pesos, or roughly 84,000 dollars. This change will cut active criminal tax cases from about 7,000 to only 200, focusing enforcement on large-scale evasion.

Second, the bill establishes a new simplified income tax regime. Taxpayers who join will pay only on their declared income, without having to justify changes in their assets or personal spending.



This approach allows people to regularize their financial situation by paying taxes on their reported earnings, regardless of past asset fluctuations. The government states that no future administration will be able to prosecute participants for past asset changes.
Argentina's Tax Reform Bill
The reform also shortens the statute of limitations for tax audits from five years to three, provided taxpayers file their returns on time. If someone makes a mistake, they can resolve it by paying what they owe, without facing criminal charges.

This aims to provide legal certainty and reduce the risk of penalties for those who comply. Officials say the goal is to move away from a“persecutory regime” that has driven many Argentines to keep their savings outside the formal system.

Years of economic instability and strict controls led people to store dollars“under the mattress” instead of in banks. The government hopes the new law will make it safer and easier for citizens to bring these funds into the open, boosting the formal economy without fear of retroactive punishment.

The bill must still pass Congress before becoming law. If approved, it could mark a significant shift in Argentina 's approach to taxation, compliance, and the use of informal savings, with the potential to reshape business and personal finance in the country.

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