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Argentina has officially launched one of President Javier Milei’s most ambitious economic reforms, targeting an estimated $170 billion in undeclared savings that citizens keep outside the formal financial system. The government formalized the Fiscal Innocence Law through Decree 93/2026, published Monday, introducing a radical shift in how the state approaches tax collection and asset declarations.
New Tax Regime Abandons Guilt Presumption
The decree establishes the Simplified Income Regime (RSG), fundamentally changing Argentina’s fiscal approach by abandoning the presumption of tax guilt. Under this voluntary system, taxpayers with annual income up to one billion pesos ($712,000) and assets up to 10 billion pesos can participate. The ARCA revenue agency will now focus exclusively on invoiced and declared income, losing the power to audit asset increases, personal consumption, or bank deposits for participating taxpayers.
Income tax calculations will be based solely on declared income and admitted deductions, with ARCA providing pre-loaded tax returns that taxpayers can accept or adjust. A key provision offers complete protection from administrative or criminal claims for timely payments, except in cases involving omitted invoiced income.
Criminal Thresholds Drastically Raised
The reform dramatically increases the minimum thresholds for tax violations to constitute crimes. Simple tax evasion now requires 100 million pesos in unpaid taxes, up from 1.5 million pesos previously. Aggravated evasion thresholds jumped from 15 million to one billion pesos. The statute of limitations for non-violating taxpayers was reduced from five to three years.
New mechanisms allow taxpayers to avoid criminal charges entirely through single cancellation payments covering principal and interest, or through regularization with a 50 percent surcharge if paid within 30 days of notification.
Dollar Integration Requirements
To operate within the new regime, undeclared savings must enter Argentina’s financial system either at the beginning or end of transactions. Cash real estate purchases remain exempt, while bank reporting thresholds increase to 10 million pesos per month for automatic transaction reports. The sanction system was updated with higher nominal penalties but includes mandatory 10-15 business day notice periods for regularization and up to 50 percent reductions for timely compliance.
Currency Stability Implications
The Economy Ministry’s estimate of $170 billion in hidden savings represents a massive potential injection into Argentina’s formal financial system. Successfully bringing these “mattress dollars” into banks could significantly boost the country’s foreign exchange reserves and provide greater stability for the peso. Argentina’s chronic currency instability has historically driven citizens to hoard US dollars outside the banking system as a hedge against devaluation and inflation.
The government aims to transform asset declaration from an exceptional event into a permanent mechanism, focusing regulatory attention only on what taxpayers declare and pay going forward. This represents a fundamental shift from Argentina’s traditionally aggressive tax enforcement approach toward incentivizing voluntary compliance through reduced scrutiny and criminal liability protection.
Sources: Batimes
