Fiscal Innocence: Government Proposes Expanding the Regime and Setting a $5 Million Threshold for Challenges

The Ministry of Economy presented modifications to the Fiscal Innocence Bill, according to an official statement from the portfolio. The announcement was made by Minister Luis Caputo and the Legal and Technical Secretary of the Presidency, María Ibarzabal Murphy, at a press conference. In that context, tax specialists Sonia Becherman, Liban Kusa and Ricardo Paolina answered questions about the main changes introduced to the bill.

What changes for those who want to join the regime

The first change concerns the subjects who can enter the simplified income tax return system. The current law requires the taxpayer to simultaneously meet three conditions: annual income not exceeding one billion pesos, total wealth not exceeding ten billion pesos, and not qualifying as a “Large Taxpayer” under ARCA rules.

The bill eliminates those conditions: the regime is open to all resident individuals and undivided estates in the country regardless of wealth or income, with one exception regarding “Large Taxpayers.” According to the official text, those taxpayers may join the “simplified modality” — which allows the tax authority to pre-settle their tax and lets them pay more efficiently — but they do not enjoy the presumptions, liberating effects or other benefits provided by the law.

The $5 million threshold and the presumption of accuracy

The second change touches one of the most sensitive points of the regime: when the tax authority can break the taxpayer’s presumption of accuracy. Today the law says that if ARCA’s challenge results in an increase of 15% or more over what was declared, the presumption automatically falls. The bill introduces a minimum threshold: even if 15% is exceeded, the presumption of accuracy is not broken if the nominal difference claimed does not reach the equivalent of 5% of the evasion amount provided for in Article 1 of the Tax Criminal Law. In concrete numbers, according to the statement: if the difference does not exceed five million pesos, the presumption is maintained.

In addition, if ARCA detects a significant discrepancy, the taxpayer may now file an amended tax return and settle the difference — plus the corresponding interest — within up to 15 business days from being notified of the official determination. The fourth change provides an additional tool: the presumption of accuracy is fully restored and ARCA is obliged to refund the contributions paid with interest, within no more than 45 business days from notification of the final resolution.

The official argument: formalizing savings outside the system

Caputo stated that “the spirit of the law does not change in absolutely anything” and that the goal remains for those savings to be formalized in the banking system without any penalty of any kind. According to the minister, the decision to push a new law arose after receiving observations from tax advisors on various aspects of the previously approved regulations.

The head of Economy maintained that the initiative seeks to respond to a process of growing informality generated by years of high tax pressure, fiscal deficit, monetary issuance, inflation and exchange restrictions. In that sense, he noted that those factors led many Argentines to keep their savings outside the financial system. Caputo indicated that currently, even when dollar deposits in the financial system reach record levels close to $40 billion, there is an amount more than four times that figure in savings kept outside the banking circuit.

“For people, keeping dollars under the mattress is a very bad deal. Dollars lose value because there is also inflation in the United States. A dollar today does not buy the same as a dollar 20 years ago,” the minister said. And he added: “At the country level, it also does not serve us for people to keep dollars under the mattress, because we need to grow as a country, we need the economy to grow and we need to collect more.”

Value module: what the official numbers say

• Document: Ministry of Economy statement on the Fiscal Innocence Bill.
• Body and date: Ministry of Economy, Wednesday press conference (no exact date in the material).
• Unit: U.S. dollars and Argentine pesos, according to the text.
• Values used: dollar deposits in the financial system close to USD 40 billion; savings outside the banking circuit more than four times that amount; nominal difference threshold of $5,000,000; 15% increase over what was declared; 15 business days to amend; 45 business days for refund.
• Operation: the statement affirms that savings outside the system exceed four times record deposits. No currency conversion is performed because the material does not report an exchange rate or date. The “four times” relationship is reproduced as stated by the source, without calculating an absolute amount.

Immediate, conditional and still uncertain effects

Immediate effects: the announcement is a bill that the Government will send to Congress, according to the title of the statement. Therefore, the proposed changes are not yet in force. The press conference and the tax specialists’ response are part of the official presentation.

Conditional effects: if Congress approves the bill, resident individuals and undivided estates may join the regime without income and wealth caps, except for “Large Taxpayers,” who would access only the simplified modality. The application of the $5 million threshold to maintain the presumption of accuracy and the amendment and refund deadlines would also be conditional.

Still uncertain effects: the statement does not report the full text of the bill, the parliamentary schedule or the estimated fiscal impact. Nor does it specify how pre-settlement for Large Taxpayers will be implemented in practice or the exact mechanism for calculating 5% of the evasion amount provided for in the Tax Criminal Law. The claim about savings outside the system (more than four times deposits) is not accompanied by a statistical source other than the minister himself.

What data or decision should be followed

The central data to follow is the parliamentary treatment of the bill: whether the four announced changes are maintained — elimination of caps, $5 million threshold, 15 business days to amend and refund with interest within 45 business days — and whether the final wording of the text matches what was presented at the conference. It is also worth watching the publication of the full bill and official estimates of the amount of savings sought to be formalized, given that the statement does not include them.