What is missing from whitewashing in construction to make it work?

The Construction Incentive Regime, (known as Laundering), came in August with its 2022 version (remember that in March 2021 it came out with Law 27,213, but it took so long to regulate that it totally failed).

The new 2022 version gave more logical timelines and contributors and developers were excited:

• There is a year to qualify, if it was done before November 19 it was cheaper (5% of the laundered amount, in pesos or foreign currency), now we are at the stage of paying 10%.
• If dollars are laundered, it is even cheaper, because the dollar is taken at the official value
• The origin of the money is not asked, funds from abroad can also be entered to launder them.
• The time to choose what to invest in is two years (until 12/31/24), so it gives you the option to think, decide, choose and explore.
• You can invest in new works, you cannot have more than 50% progress: the objective was to stimulate the construction market that generates work and value in a cascade and boosts the economy.
• There are no restrictions on which work to choose, it can be for housing, office, premises or a good to re-sell.
• It is implemented by opening a special CECON.AR account in any Bank.
• Developers must register their real estate projects in the REPI registry, which is simple, attaching the building permit.

And what happened to the laundering for construction sites that is in force?

Although many accepted and already paid developers, it was not what was expected, perhaps when there was talk that the 2023 budget would have laundering for used properties, it put a stop to it.

We advise that the laundering of used homes that the 2023 Budget brings, be regulated quickly and be easy to implement.

Regarding money laundering for foreign accounts, for now there is a lot of uncertainty… everyone remembers the money laundering established by the government of Mauricio Macri of 2016, which promised to lower the personal property tax to 0%. But, instead, the aliquot went up multiplied by 10: up to 2.25% is paid each year for assets abroad, which neutralizes any income, the advances and the balance to be paid eat up the capital.

What do the families, taxpayers and workers of our country need to reinvest here and plan their investments here?

Confidence, economic stability, not changing the rules of the game just to raise more, legal certainty is needed.

Laundering should be easy to implement, clear in its rules, for the lowest amounts it should be at zero cost, and for the other amounts it should be progressive, but without very high rates, with an incentive if funds are brought into the country and reinvested. And it should be ensured that the tax rate on laundered assets is not increased in future tax reforms.

The personal property tax should be like in Europe, only for those who exceed high amounts of the taxable minimum. In this case, everyone wins: the country, investment, employment and collection.

With these conditions, families will be able to plan their assets, they will be able to innovate by looking at the best investments to preserve capital and obtain income, without having to hide funds forever without making them yield, and looking towards this new era of international transparency

The CEDIN was extended 5 times, but they failed due to lack of confidence, the ghost of the corralito still remained in the minds of the Argentines and they did not dare to use this excellent money-laundering tool at no cost.

Companies need to be able to plan ahead, especially in foreign trade. We also hope that this new laundering to pay foreign suppliers with currency dollars will help to prevent production chains from being cut and jobs are not lost, even if it is more expensive, the worst scenario is having to cut manufacturing.

Accountant, participates in the Fecoba Tax Board, President of CEMS, Women’s Business Convergence.