Argentinian Tax Authority, AFIP, has stated that they will be able to seize any assets owed by taxpayers in digital wallets if the tax debts are not settled. Last year, the organization recommended the law but did not execute it until early 2022 during the Covid-19 pandemic.
Related Reading | Making Money in Bitcoin Markets? Don’t Forget About Crypto Taxes
Track live crypto price of 10000+ coins!
The organization now has a procedure for confiscating digital assets in these accounts. This addition will allow authorities access not only bank accounts and loans given out by third parties but also houses and cars owned by individuals who may be involved with cryptocurrencies transaction history- even if they made those purchases decades ago! Official sources told local media that:
The development of electronic means of payment and their widespread use explains the agency’s decision to include digital accounts in the list of assets seized to collect debts.
Financial institutions must give up customer information when it comes under pressure from the law. The Argentinian Tax Authority has announced that they will confiscate 9800 taxpayers’ digital accounts.
Tax Collection Procedure By Crypto
Argentina’s tax authorities are going after digital wallets that handle the national fiat currency, such as Bimo and Ualá. The most important target for these tax agents is Mercado Pago, an e-commerce platform with bitcoin-friendly policies allowing debtors to store their savings away from pesky collectors who want a cut of their earnings.
When a person or company owes taxes, it’s not just their digital wallet that the organization will target. First, the organization pursues more liquid alternatives like cash; it moves to other assets such as cryptocurrency investments only after these funds are unavailable.
Related Reading | Thailand Government Disperses Confusion Surrounding Cryptocurrency Taxation
The government of Argentina has a rigorous approach towards cryptocurrency. In a recent interview with local media, SDC Tax Advisors’ Sebastián Domínguez confirmed that they could confiscate even cryptocurrencies if the custody of these assets depends on an entity based in Argentina.
The novelty points to the fact that digital wallets are targeted in the procedure due to their growth, but that does not imply that the rest of the assets are not subject to possible embargoes.
How Does AFIP Work?
The AFIP is the federal Argentinian tax authority, and it has sole discretion to audit any return filed by a taxpayer during its own limited period of time.
The AFIP is responsible for overseeing the accuracy of one’s tax returns. Therefore, the individual may be subject to an audit by them at any time, and it could happen in several different ways too.
The government uses different methods to collect taxes. First, they might check your income with a database. If there is enough evidence suggesting you’re hiding something, then all bets are off as far as return visits go. The second method is random sampling. Finally, an inspector will come by just for kicks or does it via computerized screenings.
The Argentinian Tax Authority has the power to send out information requests to any sector in the country. And expect a response within 15 days of being notified.
Featured image from Pixabay, chart from Tradingview.com