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Argentina Introduces Foreign Exchange Rules to Avoid Money Laundering and Tax Avoidance

Argentina

On 7 June 2010 the Central Bank of Argentina ("BCRA") passed a law to prevent money laundering and tax avoidance. The new law applies to local residents accessing the exchange market and new restrictions on foreign currency savings and / or acquisition of foreign assets. Taxand Argentina examines the new foreign exchange rules and what they mean for taxpayers.

Of importance taxpayers should be particularly aware of the following changes:

 

  • Individuals or entities purchasing more than US$ 250,000 in aggregate per year will need to file a detailed asset justification. The financial entity that intervenes in the sale of foreign currency shall verify that the amount of dollars purchased is consistent with the assets declared by such individual or entity to tax authorities in the turnover of Income Tax and Personal Assets Tax of the buyer. This requirement, however, does not apply to purchases of foreign currency which do not exceed a monthly threshold of U$S 5,000.
  • Under new BCRA directives, any local resident purchasing more than US$ 20,000 per calendar month, must do so either through a bank transfer, by an electronic payment or by check.
  • The maximum threshold for purchases of foreign currency by local residents for foreign currency savings and / or acquisition of foreign assets continues to be set at US$ 2,000,000 per calendar month for both entities and individuals.

Taxand's Take


Until now the Federal Tax Administration has controlled transactions after they took place. However with banks and exchange houses getting involved prior to transactions being executed there has been a shift in control. This is an innovative step for Argentina and will mean greater transparency throughout the transaction process preventing money laundering and tax avoidance from taking place.

Your Taxand contacts for further queries are:
Ezequiel Lipovetzky
T. +54 11 4021 2300
E. Ezequiel.Lipovetzky@bfmyl.com

Lucia Peralta Krogslund
T. +54 11 5288 2950
E. Lucia.PeraltaKrogslund@bfmyl.com

Taxand's Take Author