Argentinean Tax Agency Increases Digital Wallet Seizures
The AFIP, the Argentinean Tax Agency, has increased the country's taxpayers' digital wallet seizures. More than 1,200 digital wallets belonging to taxpayers who owed money but lacked a bank account or other assets that might be seized by the courts were taken by the organisation. Although the organisation has not yet issued orders for crypto-related seizures, it may do so in the future.
Tax officials all around the world are getting more and more knowledgeable about the many methods that taxpayers might use to conceal their cash in order to avoid paying taxes. The AFIP, an Argentine tax agency, has been active in seizing possession of the digital wallets of individuals who owe money to the institution. In other aspects, these digital wallets are not directly tied to banks because they are custodial services offered to third parties by fintech businesses. When the AFIP added these to its list of assets subject to seizure in February, the rationale for the seizures was established. According to local media, the organisation reportedly executed 1,269 seizures against consumers who have accounts on such sites since last February. Due to the precautions the Argentinian government took to protect its residents' property during the Covid-19 pandemic cycle, the organisation had gone 19 months without carrying out any debt collections prior to this.
Even though there are no clear rules defining when the tax authorities can confiscate these types of assets from debtors, the seizures often start when there are no more liquid assets, such as money in a bank account or other properties, that can be taken. Due to legal obligations, the Argentine tax office already has the information for each and every account on these sites. As a result, the organisation may easily have access to these funds.
However, the processes can only be carried out if the digital wallets are offered by domestic businesses, which explains why so many Argentineans hold so much money outside of the country. A large portion of the more than $360 billion in undeclared assets, according to government estimates, are outside the AFIP's purview.
The AFIP has no restrictions on what assets it may confiscate, and considering how well-liked cryptocurrency is right now in Argentina, it's possible that cryptocurrency housed there on local exchanges or in national custody services will also be seized. There have, however, been no reports of this occurring as of yet.
