Argentina’s President Announces Plans to Eliminate Taxes on Bitcoin Transactions Below $100,000

Author: Qin Jin

Argentine President and Bitcoin enthusiast Milai announced plans to eliminate taxes and fees on Bitcoin transactions below $100,000.

In fact, since Milais took office as the president of Argentina, his outspoken character, support for classical liberal ideas, and wisdom on the side of the Bitcoin audience, these The external label has won him countless applause and cheers in Argentina and even around the world.

Musk even praised him for the content of his speech at the Davos Forum on January 18. And some of his bright appearance does not mean that his road to power in Argentina is smooth sailing. According to incomplete statistics, Milley has fired 50,000 government employees since he took office. Deregulate legal tender laws. Even making Argentina more crypto-friendly. And what we’re talking about today, eliminating taxes on Bitcoin.

The question Milley raised was about undeclared profits that have arisen in the past, a form of amnesty whose benefits were excluded from those making less than $100,000 Pay taxes.

"Abolition of Bitcoin taxation" is a great positive event for the Bitcoin audience, but for Milai, it requires some compromises and concessions. can be made. Why? Milai was elected president at the end of 2023. His victory was actually only a partial victory, because he won and was elected president in the second round of elections. However, in the first round of elections, the opposition party, the Uganda People's Alliance, performed better than him. better. As a result, he found himself having to govern without a parliamentary majority that supported him or even wanted to oppose him. Taking office under such circumstances, it seems that his job will be more difficult.

Millay currently does not have a majority in Argentina's domestic parliament. Any policy that leads him to propose will be more difficult to implement.

The following is an article translated from Cryptonomist. It mainly discusses the issues raised by Millais about Bitcoin tax exemption and the dilemma of governing. For readers’ reference.

According to the latest report from the Argentinian news website iPROup, Millay has deleted the cryptocurrency tax plan from the "Omnibus Bill". To achieve this, he inserted a digital asset compliance provision into the original draft of the Omnibus Bill in exchange for a one-time tax on previously undeclared assets.

The provision allows Argentinian citizens to declare ownership of previously undeclared assets, such as cryptocurrencies, by paying only $15 for assets above the $100,000 threshold. % tax.

In fact, this provision creates the opportunity for tax exemption for those who declare assets worth less than $100,000, while creating a partial tax exemption for higher amounts of assets. Opportunity.

Thus, in Argentina, the current tax system will continue to apply, which does not tax those who only own cryptocurrencies, but will tax any proceeds from sales. Capital gains are subject to normal transaction taxes.

However, removing the cryptocurrency provisions from the Omnibus Bill does not mean that they have been completely abandoned, it just means that they can try other ways Approve the clause.

Problems in the Argentine Parliament

Miley in 2023 He was elected President of Argentina in November and will take office in December 2023.

But his biggest problem is that he does not have majority support in parliament.

Millais is an independent liberal who is not affiliated with any political party, but belongs to a coalition that has only one of the more than 320 members of the House of Representatives in total. There are 38 representatives and 8 senators.

In the Argentine House of Representatives, the opposition party Uganda People's Union (UP) holds a majority with 103 seats. However, out of 257 seats, the government can rely on 114 supporters, including members of the ruling party and external supporters.

Since the absolute majority will reach 129 seats, Milley will actually govern without a majority in parliament.

Please note that Parliament will be elected on October 22, 2023, and Milley won less than 30% of the vote in the first round of the election on that day. Therefore, the candidate with the most votes among the presidential candidates was Sergio Massa, the candidate of the Uganda People's Alliance.

Therefore, in fact, the October 2023 election was won by the opposition Uganda People's Alliance, while the November election (the second round of the presidential election) was won by Milai win. This makes the new president's ability to govern very complicated.

The Omnibus Bill

Includes cryptocurrency provisions in The Omnibus Bill was a massive reform attempt that the Argentine Congress did not particularly like.

In fact, in order to get it approved, Milley had to compromise so much that some passages with less consensus had to be deleted.

Interior Secretary Guillermo Francos said that the entire section on fiscal issues in the bill has been deleted, and the cryptocurrency provisions are actually has been postponed. This shows that in the near future, this matter will once again attract the attention and discussion of the government and parliament.

The problem is that the approval of the Omnibus Bill has been delayed several times because there are many issues in the Omnibus Bill that are being debated in Parliament. Negotiations had to be made because Milley did not have a real majority in parliament.

Francos believes that eliminating the tax component is crucial to speeding up legal approvals.

Cryptocurrency Taxation in Argentina

In Argentina, the only The cryptocurrency tax is a tax levied on capital gains from sales.

Individuals residing in Argentina must pay tax on income from the sale of cryptocurrencies at a rate of 15%, while corporate profits, etc. are subject to progressive rates of 25% to 35% tax, plus an additional 7% tax on any dividend distribution.

Thus, among countries that tax capital gains from cryptocurrencies, the rate is lower than many others but still in line with the rest of the world.

The question Milley raised was about undeclared profits that have arisen in the past, a form of amnesty whose benefits were excluded from those making less than $100,000 Pay taxes.

The future evolution of Argentina’s cryptocurrency tax

It is still unclear It’s unclear whether Millay will actually support cryptocurrencies or Bitcoin in Argentina.

What is known so far is that he has abandoned his plan to close the Argentine Central Bank and replace the Argentine peso with the U.S. dollar.

However, he reiterated that this was only a temporary abandonment, of course because he did not have the support of a majority in parliament.

In other words, his victory at the end of 2023 is only a partial victory, because even if he wins the second round and is elected president, he will not be elected president in the first round. In the elections, the Uganda People's Alliance performed better than him. As a result, he found himself having to govern with a parliamentary majority that did not support him and even wanted to oppose him.

In this case, it seems that it will be more difficult for him to govern.