MercoPress. South Atlantic News Agency

Argentina courts shelve hundreds of tax-evasion cases after “Fiscal Innocence” law takes effect

In 2024, President Javier Milei told business leaders that those who “escape the claws of the State” are “heroes,” criticizing what he called “stupid taxes.”

Argentina’s federal courts have begun closing hundreds of tax-evasion in bulk following the rollout of the so-called Fiscal Innocence framework, a reform that sharply raised the monetary thresholds required for tax evasion to qualify as a criminal offense and that is being applied retroactively under the “more benign criminal law” principle.

The measure —Law 27,799, according to official information released by the Customs and Revenue Agency (ARCA)— sets the new “simple evasion” threshold at 100 million pesos and “aggravated evasion” at 1 billion pesos. The official release also cites changes to the statute of limitations (from five to three years) and states that, once an infringement is detected, a notified taxpayer could settle the debt without going through a criminal case.

The judicial impact is concentrated in cases opened under far lower thresholds, in an economy shaped by years of high inflation. Because constitutional doctrine requires applying the law that is more favorable to defendants when rules change, judges must reassess pending files against the new limits: if the alleged amount falls below the updated threshold, the conduct no longer meets the criminal definition and the case is dismissed.

Retroactive application of updated monetary triggers has already been endorsed by Argentina’s Supreme Court in Vidal (2021). In that ruling, the court rejected the idea that higher thresholds should be treated automatically as mere inflation adjustments and reaffirmed that the “most benign law” principle can apply to criminal tax thresholds.

President Javier Milei had signaled his stance on taxation and economic behavior in 2024. Addressing business leaders, he said those who managed to “escape the claws of the State” would be “heroes,” not criminals, and derided “stupid taxes.” From within the judiciary, an official quoted by local reporting described the immediate consequence: “we now have to leave a huge number of cases in impunity.”

In the private sector, tax adviser César Litvin argued that criminal thresholds had not been updated since 2018 and that inflation had turned the system into a pipeline for low-value cases: “A $1,000 evasion was already punishable; even a small kiosk could get caught,” he said. Litvin added that the reform aims to prevent future distortions, including periodic updates and rules meant to narrow retroactivity disputes going forward.

Dismissal of criminal cases does not eliminate administrative exposure. Argentina’s tax procedure framework still provides for financial penalties for “tax fraud,” including fines ranging from two to six times the evaded tax, alongside other enforcement tools.

Inside the courts, the debate continues over whether reduced caseloads will enable authorities to focus on larger, more complex schemes — or whether the reform will weaken incentives and capacity to pursue high-value prosecutions. The government’s messaging frames the policy as a “paradigm shift,” stating it “returns to Argentines the freedom to use their money without having to explain it to anyone,” language critics read as a political signal of lower punitive intensity in fiscal matters.