New commitment allows exchange of tax information to restrict tax evasion and tax evasion in the country
The Minister of Economy of Argentina, Sergio Massa, announced this Monday (5.Dec.2022) the signing of a new fiscal transparency agreement with the United States that allows the exchange of banking information of customers in the countries.
Alongside the US ambassador to Argentina, Marc Stanley, the minister stated that the commitment seeks to restrict tax evasion in tax havens and prevent the evasion of dollars from the country. The information is from the newspaper Clarin.
The agreement was signed under the terms of the Facta (Foreign Account Tax Compliance Act), US law that requires foreign banking institutions to provide information on transactions and assets held by holders from other countries in US-hosted accounts.
“We do not want Argentines to use the US financial system as a tax haven to escape their obligations to the Argentine treasury”said Massa.
The countries had already signed a transparency agreement during the government of former Argentine president Maurício Macri, in 2017, but they restricted the sharing of data to individual requests made by the authorities. According to Massa, only 68 accounts had information exchanged between governments in 2022.
“We know the impact that [o acordo] will have in 2023, but also the impact it will have for 5 or 10 years not only for Argentina, but also for the United States in terms of the exchange of information on mutual investments”said the minister.
The terms will also oversee profits and returns obtained in personal accounts linked to companies or property rentals, in addition to transfers between bank accounts.
“We don’t intend to persecute anyone, as they say out there. We are looking for something much simpler: that the Argentine who pays his taxes and fulfills his obligations every day and makes an effort to contribute to the maintenance of the State does not allow himself to be treated with mockery by those who find tax evasion mechanisms”said Massa.
The minister also said that he should submit a law to the Argentine Congress in the coming days to tighten restrictions against Argentine money laundering abroad. The measures, assessed Massa, strengthen the country’s intention to comply with the reforms for joining the OECD (Organization for Economic Cooperation and Development) and ensure a seal of fiscal reliability in the market.
“When you talk about austere management […] We forgot to put on the table that anyone who evades their obligations, evades taxes, is also attacking good administration and the principle of fiscal order that a State needs.”
Argentina has had an exchange control policy and restriction on the purchase of dollars since 2018. Few economic sectors are able to access the official US dollar. As a result, Argentines need to pay more from the blue dollar (or parallel dollar), a type of clandestine exchange rate.
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