MercoPress. South Atlantic News Agency

Argentine Senators launch bid to tax assets abroad and pay off the IMF

Those who do not comply with the payment of this contribution might risk going to prison

Argentina's ruling Frente de Todos (FdT) lawmakers Monday suggested a new tax on assets and money not declared to the local Treasury and kept abroad be levied in order to pay the country's debt with the International Monetary Fund (IMF).

FdT Senators proposed Monday to create the “national fund for the cancellation of the debt with the IMF,” made up of a tax on assets and money abroad not declared to the Treasury, it was announced.

“It is sought that those who have assets abroad that were absconded and are not declared before the Treasury make a special emergency contribution,” the Senatorial bloc explained in a statement.

The initiative is positively valued by the Government of Alberto Fernández, according to Presidential spokeswoman Gabriela Cerruti.

Vice-President Cristina Fernández de Kirchner said Monday during a meeting with US Ambassador Marc Stanley that she requested Washington's help with the bill promoted by the government in the Upper House.

Last Friday, the IMF board approved a new extended facilities program by which it will lend Argentina about US$ 45 billion to cancel debts for a similar amount borrowed in 2018 under then-President Mauricio Macri (2015-2019).

The new agreement was endorsed by a legislative majority, despite votes against it from lawmakers loyal to the former head of state, who opposes the fiscal adjustment the new program brings on.

The new bill, which has already been rejected by several opposition leaders, targets those who have undeclared assets abroad. If they declare them immediately to the Treasury, they will have to pay a contribution of 20% in dollars on such assets, but if they declare them after six months from the entry into force of the law, the rate will be 35%, it was explained. Those who do not comply with the payment of this contribution would run the risk of going to prison, it was also reported.

The initiative even reaches those who have changed their tax residence to another country when the real place of life and business is still Argentina and it even proposes the use of the figure of the “collaborator,” who would help the Treasury find undeclared assets and who will be rewarded with up to 30% of what is obtained for the information provided.

Another bill will be submitted shortly to modify the exceptions to banking, stock exchange, and tax secrecy, it was reported.

The senators point out that there are US$ 417,507 million belonging to Argentine citizens abroad or outside the Argentine financial system, of which only US$ 69,000 million have been declared to the Treasury.