The new bill proposed by Argentina aims to offer crypto incentives through favorable tax rates to those who declare their domestic and foreign crypto holdings.
Argentina’s issues regarding high inflation continued through 2023, with its economy facing numerous challenges. November’s inflation rate exceeded 160%, as the problems look far over. The new Argentinian President, Javier Milei, may look ahead to 2024 as a year to solve the country’s economic challenges. Milei, an economist, recently announced a new solution in the form of crypto incentives for digital asset holders.
His government introduced a draft bill offering tax incentives to those who declare their foreign and domestic crypto holdings. The bill is a part of the economic reforms of the new government. The bill would aim to bring all crypto holders under formal taxes. At the same time, it would also incentivize them.
The bill is a part of the new government’s overall regularization regime initiative. Other assets like cash and real estate would also go through similar rules. Crypto holdings, for instance, will attract only a 5% tax if made public before March 31, 2024. However, the crypto tax rate may gradually go higher if holders don’t declare their assets.
The bill mentioned the crypto tax incentives would apply to “cryptocurrencies, crypto assets and other similar goods, regardless of who has been their issuer, who is their owner or where they were deposited, guarded or stored.” Hence, crypto holders may get a key tax benefit.
Although the outcomes of the new crypto tax policy could take time to yield results, it could be a step in the right direction. Argentina’s central bank has also supported a digital peso, joining other central banks that are aiming for central bank digital currencies.
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