The tax framework for leasing transactions – included in Decree No. 1038/2000 (“DL”), as amended – has recently been modified. It establishes four different categories of leases, each one subject to different tax effects: (i) lease agreements treated as financial transactions; (ii) lease agreement treated as asset rentals; (iii) lease agreements taxed as installment sales; and (iv) sale and lease back transactions.
For a transaction to qualify as a financial lease, DL takes into account certain aspects of the agreement, such as its length and contractual terms. Indeed, to qualify as a financial lease, the term of the agreement must exceed a minimum percentage of the useful life of the leased assets. According to the previous version of the DL such term was: (i) 50% of the useful life, in case of movable assets; (ii) 20% of the useful life, in case of real estate, other than housing; and (iii) 10% of the useful life, in case of real estate for housing.
In addition to the length requirement, for a lease agreement to qualify as a financial lease, the lessee must be a financial entity, a financial trust, or an enterprise whose main activity is the celebration of these types of contracts. Also, the price must be fixed in a certain and definite amount at the moment of executing the agreement. Otherwise, the contract shall be deemed not a financial operation but rather an asset rental. This rule does not apply if the purchase option is executed by paying the fair market value.
The Argentine Federal Executive Branch enacted Decree No. 152/2022, which modifies the standard on (ii) lease agreement treated as asset rentals. In fact, the named decree relaxes the rule, so that lease agreements destined to real estate – other than housing – could qualify as a financial lease for income tax purposes if the agreement term exceeds 10% of the useful life of the asset. This modification works as an incentive for financial leases, a core product of Argentine banks and a tax efficient structure for lessees as well.
On May 5th, 2022, the Argentine Central Bank (“ACB”) issued Communication “A” No. 7506 that is banning crypto assets transactions performed by licensed financial entities, which are regulated by Law No. 21.526 (the “Financial Entities”). Indeed, the ACB establishes that Financial Entities may not carry out or facilitate transactions with digital assets – including crypto assets and other assets whose yields are determined on the basis of the variations of crypto assets – which are not expressly authorized by an Argentine regulatory authority or by the ACB itself.
Communication “A” No. 7506 was issued only a few days after an Argentine Financial Entity started to offer to its clients the possibility to invest in certain crypto assets such as Bitcoin / Ether, either thru home banking or the bank’s apps.
At the request of the Financial Entities, the ACB clarified the scope of Communication “A” No. 7506 and stated that the ban does not go as far as to forbid the purchase of crypto assets with funds held in accounts opened in Financial Entities. In fact, the Financial Entities are just forbidden to offer or to intermediate with crypto assets, but they are not obligated to prevent their clients from using their accounts to buy or sell crypto assets.
Digital assets are a concern also of the Argentine Revenue Service (“ARS”). The ARS intends to audit and be informed as to transactions with such assets.
To such extent, by means of General Resolution No. 4614/19, the ARS created an information regime concerning tools and/or electronic applications related to movements of virtual and non-virtual assets. Particularly, such regime applies to those who administer, manage, control or process asset movements through electronic or digital management platforms, on behalf of and by order of natural and legal persons residents in Argentina or abroad (the “Information Agents”). In this sense, the “exchanges” or platforms that facilitate the means for buying and selling crypto assets are one of the subjects affected by the information regime.
Under this regime, the Information Agents must provide the following information:
Originally, such information had to be provided only with respect to the accounts that registered a yearly income equal or greater than AR$ 10,000 (lower than USD 100). However, the recently enacted General Resolution No. 5193/2022 has updated that threshold amount and has introduced a new threshold. Under these new circumstances, the reporting requirement concerns:
The thresholds remain quite low, so it is doubtful whether the ARS will be able to cope with all such information.
If you wish to discuss these topics, please contact: Rosso Alba & Rougès, Buenos Aires, Argentina
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