- Argentinian president Javier Milei is pushing a new bill that seeks to offer significant tax cuts to residents who make their crypto declarations before the end of March in a bid to revive the dying economy.
- Assets held locally or offshore, reported by March, will attract 5% taxes, while those who wait until November will pay up to 15%, but the bill faces tremendous backlash and street protests.
Javier Milei is the face of controversy in global politics, and just three weeks after he took office as the leader of Argentina, he is pushing a new bill that could have significant implications for Agentine Bitcoin holders. The bill, which is facing substantial backlash and opposition, offers reduced tax rates for investors who declare their crypto and other assets by March, but Milei’s critics say he’s turning into a dictator.
Milei took office on December 10, and as CNF has reported, the crypto community globally has great expectations. In his campaigns, the self-proclaimed “anarcho-capitalist” touted Bitcoin as the way and said it took money back to where it belongs—in the hands of private investors.
However, his new bill is ruffling feathers in crypto and beyond. It demands that Argentinians declare their crypto holdings in the country or abroad. This will entitle the investor to favourable tax rates; if reported before the end of March, the tax will be 5%, but if it stretches to November, the taxes will be as high as 15%.
The bill is not specific to crypto and is part of Milei’s sweeping economic reforms, which he believes will put Argentina back on a path to prosperity. It applies to “cryptocurrencies, crypto assets, and other similar goods, regardless of who has been their issuer, who is their owner or where they were deposited, guarded or stored.”
Milei Divides Crypto Investors in Argentina
Aside from targeting offshore assets, Milei’s 664-page bill also cracks down on protesters, who will now face stricter penalties for street protests. It also seeks to eliminate the existing proportional voting and representation system in Congress. A key aspect is that it confers some of the powers of Congress to the president, making Milei more powerful than his predecessors.
Currently, the bill is in effect via a presidential decree as it awaits the decision of both houses of Congress. Both would have to vote against it for the bill not to sail through. However, Milei’s party only holds a small percentage of seats in both houses. The eccentric president has threatened to call for a national referendum if Congress votes against him so that the legislators “can explain to me why they are against the people”.
Experts believe that the chances of the bill sailing through as is are slim as Milei only commands 15% of the lower house and 10% of the upper house.
“My doubt is whether Milei is open to accepting changes or whether he wants the bill to pass without accepting any amendments. If he goes for the second option, he is literally declaring war on the legislative branch and has a high chance of losing,” commented Ignacio Labaqui, an analyst at Medley Global Advisors in the capital, Buenos Aires.
