Argentinian Taxpayers Concerned About Possible Tax on Crypto

A new line of arguments is taking place in Argentina where the two major provinces of the country have passed laws approving the imposition of tax against crypto. The law would entail disclosures of crypto holdings by the citizens/taxpayers of the two provinces namely Cordoba and Tucuman.

Provincial autonomy is good but it could be bad as well if the Federation is kept aside from matters of public importance. It has been seen very often that provincial autonomy could lead to legal reforms which can erode the concept of equality within a state. For example, if the matter involves the imposition of taxes from the taxpayers then the Federation’s involvement is a must. However, it has been seen in many countries that provinces do not engage in consultation with the Federation. Instead, they proceed with imposing tax rates on their own. Consequently, in a state, it has been seen that the two states have different tax rates altogether. This then becomes quite problematic for a country. In this situation, it is called that provincial autonomy is a must but there has to be some involvement of federation.

A great example of this situation can be found in Argentina. Two of the major provinces of the country namely Tucuman and Cordoba have sanctioned a few amendments in the taxation laws. However, the tax law amendments have been suggested by only two provinces only. Both the provinces want to tax taxpayers residing within their provinces against their crypto holdings.

The proposal of crypto tax in the two provinces stems from the adoption of crypto regulation in another province of Argentina. Thereafter, other provinces of the country started to join in with the crypto tax imposing province. In this connection, the provincial authorities in the provinces of Tucuman and Cordoba have directed the concerned to recommend tax law amendments. One of the provisions likely to become part of the amendment proposal is that the taxpayers of the provinces cannot now hide their crypto holdings. In fact, they would be bound under the law to make full disclosures of their crypto holdings to the provincial tax collection authorities. In addition, crypto trading will be taxed in the same manner as other trading are taxed in the provinces.

The first amongst the two provinces to pass tax amendment proposals is the Province of Tucuman. Provincial Government has passed the amendment which will be incorporated in the tax provision of Article 223. The amendment suggests that taxes will be imposed on the trading and exchanging of foreign currencies. The law would also be applicable to the securities backed by the Argentinian Government. In addition, a proviso has been added which provides that the sale and purchase of currencies will also include the sale and purchase of digital currencies. Resultantly, the trading of cryptocurrencies too will be taxed as if they were trading of local and foreign currencies.