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Argentina Takes a Step Forward in Compliance with US Treasury Department Regulations

Buenos Aires, Argentina - The Argentine government has made significant strides in recent months to comply with regulations set forth by the US Treasury Department’s Foreign Account Tax Compliance Act (FATCA). On December 5, 2022, Sergio Massa, then Minister of Economy, and Marc Stanley, U.S. Ambassador to Argentina, signed a bilateral agreement establishing an automatic exchange of financial information between the two countries.

A Key Player in the Global Fight Against Tax Evasion

FATCA is a crucial tool in preventing tax evasion and improving tax compliance globally. The act requires foreign financial institutions to report on US persons holding foreign financial accounts. If they fail to comply, they face an automatic 30% withholding on any FDAP income from the United States.

Argentina’s signing of the FATCA agreement demonstrates its commitment to transparency and cooperation in international taxation. The exchange of information between Argentina and the United States will help promote the correct application of tax regimes and prevent the loss of tax revenues derived from undeclared income.

Key Provisions of the Agreement

The agreement requires Argentine financial institutions to report annually on each reportable account, including:

  • Data of the Holder: name, address, and US Tax Identification Number (TIN) of each specific US person that holds the account
  • Account Details: account number or equivalent functional element if no number is available, balance or value of the account at the end of the calendar year
  • Revenues and Transactions: total gross amount of interest, dividends, and other income derived from assets in the account during the calendar year

In return, the United States has committed to provide Argentina with information on all accounts held by Argentine residents in the US.

A Step Forward for Tax Compliance

The FATCA agreement is a significant step forward for tax compliance in Argentina. The exchange of information between the two countries will help prevent tax evasion and promote transparency in international taxation. As part of its efforts, Trans World Compliance (TWC) provides streamlined regulatory compliance technology and world-class multilingual support to help organizations worldwide comply with international tax information exchange regulations.

By working together, Argentina and the United States can ensure that taxes are collected fairly and efficiently, promoting economic growth and stability for both countries.