ARGENTINA AIMS TO LEGALIZE BILLIONS OF DOLLARS IN UNDECLARED FUNDS

The libertarian government of Argentinian President Javier Milei aims to legalize billions of dollars in undeclared funds.

Government spokesman Manuel Adorni announced that through a decree and a draft law, capital controls in the South American country are to be significantly relaxed.

The goal is to encourage savers to bring their reserves, whether in cash or held abroad, back into the official economic system.

"We need more liquidity for the economy. If we achieve this, growth will be sustainable," said Economy Minister Luis Caputo.

A whole range of reporting obligations to the tax authority, for example regarding transfers, cash withdrawals, as well as property and car sales, are to be abolished.

"Argentinians are once again considered innocent until the tax authority proves otherwise. Your dollars, your decision," said Adorni.

A considerable part of the economy in Argentina operates outside the tax system. Additionally, until recently, private individuals were prohibited from acquiring large amounts of dollars, which is why cash reserves in dollars were mostly exchanged on the black market.

Estimates suggest that Argentinians hold between $250 billion and $400 billion in cash or abroad. Due to high inflation in the national currency, the peso, and distrust of banks, Argentinians have primarily invested their savings in dollars over the past decades.

No other country in the world outside the United States has as many dollar notes in circulation as Argentina.

Now, the government wants savers to spend their dollars to stimulate the struggling economy.

"If these funds are pumped into the economy, it will lead to an enormous acceleration of the growth rate," President Milei said recently in a television interview.

"It's like a legalization of undeclared funds, but without paying taxes. It's not about collecting taxes, but about making funds available. So that people can freely dispose of their money."

2025-05-22T20:45:07Z