Argentina’s government has officially enacted the Fiscal Innocence Law, aiming to promote the formalization of undeclared savings, including the notorious “mattress dollars,” while also redefining the dynamics between the state and taxpayers. The measure, representing one of the most ambitious tax reforms of President Javier Milei’s administration, was formalized by Decree 93/2026, which appeared in the Official Gazette on Monday. The introduction of a new scheme, the Simplified Income Regime, has been enacted, which explicitly constrains the auditing powers of the ARCA revenue and customs agency. From this point forward, ARCA’s controls will concentrate solely on invoiced and declared income.
The core of the regulation revolves around a modification in fiscal criteria. Individuals following the RSG regime will participate in a framework that discards the assumption of tax liability. The key elements of the new regime encompass:
- Asset security: ARCA may not audit increases in assets, personal consumption, or bank deposits.
- Taxing by invoicing: Income tax will be calculated exclusively on declared income and accepted deductions.
- Pre-loaded returns: The authority will provide a return that the taxpayer can either accept or modify.
- Exemption effect (“fiscal plug”): A timely payment absolves the taxpayer from any administrative or criminal claims during those periods, except in cases of omitted invoiced income.
The regime is voluntary and pertains to individuals whose annual income does not exceed one billion pesos (approximately US$712,000) and whose assets are capped at 10 billion pesos, with verification conducted annually over the past three tax years. The scheme excludes major taxpayers.
The regulation also introduced a significant amendment to the Tax Criminal Regime, notably increasing the minimum thresholds for a breach to constitute a crime. The newly established standards are:
- Basic evasion: from 1.5 million to 100 million pesos
- Aggravated evasion: ranging from 15 million to one billion pesos
- Statute of limitations: decreased from five years to three years for taxpayers not in violation.
Furthermore, mechanisms for the dismissal of criminal charges are also permitted:
- Single cancellation: payment of principal and interest without the initiation of a criminal lawsuit (one-time benefit)
- Regularisation with surcharge: in the absence of a complaint, the charges may be waived by settling the debt along with an additional 50 percent within a 30-day period.
The regulatory decree delineates the permissible applications of undeclared savings. To function within the established framework, the funds are required to integrate into the financial system, regardless of whether this occurs at the initiation or conclusion of the transaction. The exception remains in place for cash purchases of real estate, while the thresholds for bank information have been elevated: transactions up to 10 million pesos per month will not trigger automatic reporting.
Simultaneously, the sanction scheme underwent an update:
- Fines: Penalties have been raised in nominal terms, accompanied by a revised procedure.
- Mandatory prior notice: ARCA is required to provide a notice period of 10 to 15 business days for regularization before issuing a formal order.
- Gradation of sanctions: There is a differentiated approach for small and medium-sized enterprises, with potential reductions of up to 50 percent for timely regularization.
The Economy Ministry estimates that approximately US$170 billion is retained by Argentines outside the formal financial system. The stated objective of this initiative is to transform the declaration of assets into a consistent practice, rather than an extraordinary one, grounded in a straightforward principle: focusing solely on what is disclosed and remitted henceforth.