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Argentina targets US dollars hoarded under mattresses, eases tax evasion rules
The country wants Argentines to bank their dollars amid high inflation, with estimates of ‘mattress dollars’ totalling US$251 billion
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Argentine President Javier Milei on Friday signed into law a so-called “tax innocence” bill, which aims to encourage people to bank dollars stashed under mattresses or in offshore accounts by forgiving a degree of tax evasion.
Over years of high inflation and currency controls, Argentines traded their battered pesos for dollars, which they often hoarded at home, in cash.
The government estimates Argentines are sitting on some US$251 billion in what are commonly called “mattress dollars” – six times the Central Bank’s reserves, which stood at US$41 billion on December 30.
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Milei has been on a mission to get citizens to bank their dollars to help the state meet foreign debt payments totalling US$19 billion this year, according to the Congressional Budget Office.
The International Monetary Fund, which Argentina owes tens of billions of dollars, asked the government to step up its efforts to rebuild its depleted currency reserves.
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To lure deposits, Congress in December voted to raise 66-fold the amount for which citizens can face prosecution for tax evasion to the equivalent of US$70,000 per financial year.
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