If taxpayers have any debts to the Argentinian Tax Authority(AFIP), they will now have the ability to seize assets stored in digital wallets. These digital accounts were recommended to the institution’s attorneys last year. However, debt collection was stopped during the Covid-19 pandemic. These procedures were executed however on January 31.
Argentinian Tax Authority Eyeing Digital Wallets
The Argentinian Tax Authority (AFIP) has added digital wallet funds to its list of assets that could be taken from taxpayers in order to pay tax debts. The addition was made by state attorneys in November. However, confiscation proceedings of this type were suspended for the duration of January 31, due to the Covid-19 pandemic.
This organization now has a clear procedure to seize digital assets. This is in addition to the other investments it has at its disposal, including bank accounts, loans made to third parties and houses. Sources close to the situation stated that this was a significant addition.
The development of electronic means of payment and their widespread use explains the agency’s decision to include digital accounts in the list of assets that can be seized to collect debts.
Because of different regulations that require financial institutions to provide customer information to law enforcement agencies, the Argentinian Tax Authority can collect relevant data. According to reports, there are 9800 taxpayers whose digital account will be taken.
Current Procedures & Crypto
This newly approved procedure will allow the institution to confiscate funds from more than 30 digital wallets that handle the national fiat currency in the country, such as Bimo, and Ualá. The Argentinian Tax Authority’s most significant target is Mercado Pago. This digital wallet, which is a Bitcoin-friendly retail unicorn and allows debtors save their money away from the tax authorities, but it also serves as the digital wallet for Mercadolibre.
When collecting taxes debt, digital wallets won’t be the first targets. The first step is to seize liquid assets. The organization will only pursue assets if these funds are unavailable.
Sebastián Domínguez from SDC Tax Advisors told local media that even cryptocurrencies could be confiscated if the custody of these assets depends on an entity based in Argentina. He explained:
Although the novelty of digital wallets being targeted in this procedure is due to growth, it does not necessarily mean other assets are immune to embargoes.
How do you feel about the Argentinian Tax Authority stealing funds from digital wallets in order to pay taxes?
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