The Argentinian Tax Agency (AFIP) has increased the number of digital wallets that are being seized by the government. The institution was able to seize more that 1,200 digital wallets from taxpayers who had outstanding debts but didn’t have a bank or other property available for collection by the courts. Although the organization has not yet ordered crypto-related seizures to be taken, it may in the future.
The various ways that taxpayers hide their money to avoid taxes are being recognized by tax regulators all over the globe. The Argentinian tax authority, the AFIP has been busy taking over digital wallets belonging to debtors to the institution. These digital wallets provide custodial services to third parties by fintech companies, which in some cases are not directly connected to banks. These were included in the list by the AFIP in February, when was established.
Local media reports that the institution has managed since February to execute 1,269 seizures on customers who had accounts on these platforms. The measures taken by the Argentinian government to protect the property of its citizens during the Covid-19 epidemic cycle meant that the organization was able to execute no debt collection for 19 months.
Although there is no specific procedure that explains when tax authorities can seize these assets from debtors there are usually no liquid assets that can be seized. For example, funds in a bank account, or other assets, seizures are most common. Due to legal requirements, the Argentinian tax agency already holds all data for each account on these platforms. This allows the organization to easily access these funds.
The procedures cannot be performed if digital wallets are not provided by national companies. This is why so much money is kept outside of Argentina by citizens. Official estimates suggest that more than $360 million is not declared, with a large portion of these funds beyond the reach of AFIP.
The AFIP can seize any assets. This includes cryptocurrency that is held on Argentinian Exchanges or National Custody Services. Given the current popularity of crypto in Argentina, there are no restrictions on what assets may be seized. There have been no reports yet of such a thing.