The guide establishes the conditions that people in Chile, Colombia, Peru, and Argentina must comply with. In Argentina, cryptocurrency tax laws are still under development.
The Latin American exchange Buda.com recently published on its blog a guide on the tax landscape of Bitcoin (BTC) and other cryptocurrencies in some Latin American countries.
The Buda team produced a guide for which they selected Chile, Colombia, Peru, and Argentina as countries where users must pay taxes on their cryptocurrencies. The guide specifies the cases for which a person must pay taxes on cryptocurrencies in each country. Besides, it explains the steps that they must follow if they have to pay this type of tax.
Buda noted that the guide is general and only for informational purposes. Their intention is not to offer any type of legal advice in these cases. They insist that to make the payment of this type of tax, users should seek professional advice and adapt to the particularities of the country where they reside.
According to the guide, Chile considers that cryptocurrencies are digital or virtual assets, as stated by Ordinance No. 963, published on May 14th, 2018. In this country, users must pay taxes when selling cryptocurrencies for Chilean pesos (CLP), paying for services, buying one cryptocurrency with another cryptocurrency, and receiving payment in cryptocurrencies.
Chileans have been subjected to this tax regime since April 2019. The country’s regulations contemplate various aspects of tax returns, but they do not take cryptocurrencies into account for the payment of value-added tax (VAT).
Colombia considers that cryptocurrencies are digital assets, according to the Directorate of National Taxes and Customs. In this country, people must pay taxes when exchanging a cryptocurrency for the local fiat currency, as well as when making a profit with them in a certain period. Other taxable activities include paying for goods and services, buying cryptocurrencies with another cryptocurrency, receiving mined cryptocurrencies, and receiving payments in cryptocurrencies.
Governments Aim to Collect Taxes on Cryptocurrencies
In February 2018, Juan José Echavarría, General Manager of the Central Bank of Colombia, stated that the owners of cryptocurrencies must pay taxes even though these assets are not legal in the Colombian economy.
Peru declared cryptocurrencies as real property, according to paragraph 10 of Article 886 in the Peruvian Civil Code. Users will have to pay taxes when buying cryptocurrencies with another cryptocurrency, receiving mined cryptocurrencies, or receiving payments in cryptocurrencies. Peru is one of the countries that have adopted the use of blockchain platforms.
Finally, the Buda’s guide states that Argentina has a law providing for the payment of taxes for cryptocurrency holders. However, the conditions that a person must meet to declare taxes for the use of their cryptocurrencies are still under development.
Even though the Argentine government does not intend to regulate taxes on cryptocurrencies, the country’s Bitcoin community gave its opinion on the matter. The NGO Bitcoin Argentina, which represents the community, criticized the State’s proposal of regulation and taxes for cryptocurrencies, giving reasons and recommendations for the treatment of taxes on cryptocurrencies.
By Willmen Blanco