Most cryptocurrency transactions and exchanges will be subject to taxation in Argentina after the government clarified and updated new rules limiting tax exemptions to third-party payment service providers, according to multiple reports.
Argentina will levy a 0.6% tax on exchanges for cryptocurrency purchases and sales. The new tax is effective immediately.
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“The exemptions provided for in this decree and in other regulations of a similar nature will not be applicable in those cases in which the movements of funds are linked to the purchase, sale, exchange, intermediation and/or any other operation on crypto assets, cryptocurrencies, digital coins or similar instruments, in the terms defined by the applicable regulations,” the government said, per the Buenos Aires Times.
Previously, crypto transactions between individuals were considered exempt as if they were cash transfers, said Sebastián Domínguez of SDC Asesores Tributarios. Crypto exchanges sidestepped taxes because they were part of an exemption that applied to FinTechs registered as payment service providers (PSPs).
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While there is no international agreement regarding how governments should handle crypto, several countries have no tax laws in place. Belarus, for example, considers crypto investments as personal, and thus not subject to taxation. Malaysia and Portugal also consider crypto transactions tax-free.
In the U.S., recent legislation implemented new guidelines that transactions over $10,000 must be reported.
Argentinian entrepreneur Damian Catanzaro, founder of the bitcoin tipping app platform Cafecito, said that after the tax, crypto users will increasingly opt for peer-to-peer exchange platforms and non-custodial wallets.
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