Will Argentina Increase Regulations and Taxes on Bitcoin? By DailyCoin
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Will Argentina Increase Regulations and Taxes on Bitcoin?- Everything indicates that yes, because the government needs to raise more money to meet its internal and external obligations, after the agreement reached with the IMF.
- The cryptocurrency industry is a very large sector in the country, representing around 25% of all Argentine savings and 17% of Argentine assets abroad.
After the agreement to refinance the external debt service reached at the end of January with the International Monetary Fund (IMF), Argentina will have to adopt a program of fiscal, monetary and financial adjustments to increase its income until 2025.
Among the measures that the government will have in mind to achieve its objectives, they will increase the provisions and taxes on . This would affect all holders of bitcoins and other cryptocurrencies in the South American country.
The government was forced to reach an agreement with the Fund to face its financial commitments derived from a debt of 57.1 billion dollars acquired with the financial institution during the administration of Mauricio Macri.
Argentina had to pay some $2.8 billion to the IMF due in March, for which the government of President Alberto Fernández had to request an extension of the payment term, given that the country does not have the necessary financial resources.
Challenges for the government
The talks and agreements with the Fund generated a series of protests in the country by sectors of the Argentine left that support the government, but were opposed to any understanding with the organization.
Even Máximo Kirchner, son of Argentine Vice President Cristina Fernández and representative of the government coalition in parliament, broke with the Alberto Fernández administration by opposing the $44.5 billion refinancing agreement signed with the Fund.
In the next two and a half years, the Fernández administration will have to introduce a series of structural changes in its economic, monetary and financial policy in order to save foreign currency and raise tax revenues.
The measures include curbing the issuance of inorganic (unsupported) money, reducing public spending to reduce the deficit, and strengthening tax administration by preventing tax evasion and raising revenues.
Eyes on the crypto industry
This is where the crypto industry can play a relevant role in capturing extraordinary income for the weakened Argentine treasury.
This sector currently reaches a total value of about 68,000 million dollars, according to Chainalysis, the company specialized in blockchain data. The figure is equivalent to a quarter of all the money of Argentines that is not registered in the national financial system and 17% of the assets that the country has abroad.
In addition, Argentina is among the 10 countries that have most adopted cryptocurrencies globally. It is above Venezuela, which has about $28,000 in cryptocurrencies and is only surpassed by Brazil with $90.9 billion, said Kim Grauer, Director of Research at Chainalysis, speaking to the iProUP news site.
In the Argentine Congress there are more projects to regulate cryptocurrencies and other digital assets that await discussion and approval. Central Bank President Miguel Pesce supports broader regulation of digital money.
On the Flipside
- Bitcoin and other digital assets could be a lifeline for Argentina’s precarious finances.
- The Central Bank of the Argentine Republic has had to burn mountains of dollars in recent years trying to support the peso.
- The tax regulator is expected to tighten controls on owning and trading cryptocurrencies.
However, the operators of BTC and the other cryptocurrencies already pay two taxes to the national treasury. Income tax and personal property tax.
On the other hand, some provinces such as Tucumán, Córdoba, Entre Ríos and Catamarca, began to charge additional taxes on the gross income generated by trading cryptocurrencies.
Why You Should Care
- The tendency to cheat cryptocurrency transactions is becoming widespread in the world. The need of countries to increase internal income to finance their expenses is forcing governments to accept and legalize the crypto industry.
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Will Argentina Increase Regulations and Taxes on Bitcoin?- Everything indicates that yes, because the government needs to raise more money to meet its internal and external obligations, after the agreement reached with the IMF.
- The cryptocurrency industry is a very large sector in the country, representing around 25% of all Argentine savings and 17% of Argentine assets abroad.
After the agreement to refinance the external debt service reached at the end of January with the International Monetary Fund (IMF), Argentina will have to adopt a program of fiscal, monetary and financial adjustments to increase its income until 2025.
Among the measures that the government will have in mind to achieve its objectives, they will increase the provisions and taxes on . This would affect all holders of bitcoins and other cryptocurrencies in the South American country.
The government was forced to reach an agreement with the Fund to face its financial commitments derived from a debt of 57.1 billion dollars acquired with the financial institution during the administration of Mauricio Macri.
Argentina had to pay some $2.8 billion to the IMF due in March, for which the government of President Alberto Fernández had to request an extension of the payment term, given that the country does not have the necessary financial resources.
Challenges for the government
The talks and agreements with the Fund generated a series of protests in the country by sectors of the Argentine left that support the government, but were opposed to any understanding with the organization.
Even Máximo Kirchner, son of Argentine Vice President Cristina Fernández and representative of the government coalition in parliament, broke with the Alberto Fernández administration by opposing the $44.5 billion refinancing agreement signed with the Fund.
In the next two and a half years, the Fernández administration will have to introduce a series of structural changes in its economic, monetary and financial policy in order to save foreign currency and raise tax revenues.
The measures include curbing the issuance of inorganic (unsupported) money, reducing public spending to reduce the deficit, and strengthening tax administration by preventing tax evasion and raising revenues.
Eyes on the crypto industry
This is where the crypto industry can play a relevant role in capturing extraordinary income for the weakened Argentine treasury.
This sector currently reaches a total value of about 68,000 million dollars, according to Chainalysis, the company specialized in blockchain data. The figure is equivalent to a quarter of all the money of Argentines that is not registered in the national financial system and 17% of the assets that the country has abroad.
In addition, Argentina is among the 10 countries that have most adopted cryptocurrencies globally. It is above Venezuela, which has about $28,000 in cryptocurrencies and is only surpassed by Brazil with $90.9 billion, said Kim Grauer, Director of Research at Chainalysis, speaking to the iProUP news site.
In the Argentine Congress there are more projects to regulate cryptocurrencies and other digital assets that await discussion and approval. Central Bank President Miguel Pesce supports broader regulation of digital money.
On the Flipside
- Bitcoin and other digital assets could be a lifeline for Argentina’s precarious finances.
- The Central Bank of the Argentine Republic has had to burn mountains of dollars in recent years trying to support the peso.
- The tax regulator is expected to tighten controls on owning and trading cryptocurrencies.
However, the operators of BTC and the other cryptocurrencies already pay two taxes to the national treasury. Income tax and personal property tax.
On the other hand, some provinces such as Tucumán, Córdoba, Entre Ríos and Catamarca, began to charge additional taxes on the gross income generated by trading cryptocurrencies.
Why You Should Care
- The tendency to cheat cryptocurrency transactions is becoming widespread in the world. The need of countries to increase internal income to finance their expenses is forcing governments to accept and legalize the crypto industry.
EMAIL NEWSLETTER
Join to get the flipside of crypto
Upgrade your inbox and get our DailyCoin editors’ picks 1x a week delivered straight to your inbox.
[contact-form-7]
You can always unsubscribe with just 1 click.
Continue reading on DailyCoin
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