The government of Argentina has signed a data sharing agreement with the United States to strengthen cooperation between the countries in the tax arena. The agreement, which was signed by Sergio Massa, Argentina’s Minister of Economy, and US Ambassador Marc Stanley, will allow the Argentine National Tax Authority to receive information from accounts and trust beneficiaries of Argentines in the US
Argentina will tighten tax control with data sharing agreement
The government of Argentina has signed an automatic tax data sharing agreement with the United States that will allow the national tax authority to receive data from accounts and communities managed by Argentine citizens offshore. The agreement, signed on December 5 by the Minister of Economy, Sergio Massa, and the US Ambassador to Argentina, Marc Stanley, involves a significant increase in the volume of data that will be shared between the Argentine Tax Authority (AFIP) and the Internal Revenue Service (IRS).
While the two countries had already signed a similar agreement in 2017 as part of the Foreign Account Tax Compliance Act (FATCA), it took a different operational approach and information sharing was managed on a case-by-case basis. Massa stated that because of these limits, they were able to receive information from only 68 citizens this year.
The tax authorities from both countries will have to convene systems to share this data, which will include joint databases as part of the protocol to be followed.
On the new system, Massa stated:
It’s a huge deal. It will include information on Argentine nationals who have signed their alien declaration at the time of depositing their money into an account in the United States and who have done so on their own as individuals and as part of corporations or trusts.
Furthermore, Massa clarified that income products from trusts or associations will also be reported as part of this agreement.
Massa aims to complement the agreement, which comes into effect on January 1, with new regulations that will allow citizens to legally move their assets and funds to other countries, but also punish money laundering and capital flight.
On the purpose of this new law, Massa explained:
We want to break the idea that this is seen as a witch hunt… AFIP is going to look for those who did not pay, to reduce the burden on those who pay taxes every day.
A bill proposed in April in the Argentine Senate also called for the taxation of undeclared goods held offshore by Argentine citizens, to pay part of the country’s debt to the International Monetary Fund. In the same month, the head of the AFIP, Mercedes Marco del Pont, called for the creation of a global system to record the holdings of electronic money and cryptocurrency. The aim is to prevent tax evasion.
What do you think of the tax data sharing agreement signed between Argentina and the United States? Tell us in the comments section below.
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