Argentina and Brazil have collected more than $20bn under tax amnesty programs as both countries crack down on tax dodgers and work to persuade people to declare their unreported offshore assets.
The Brazilian government announced on Tuesday that it had collected more than $15.8bn from a program for individuals and companies that closed on Monday. Argentina, which launched a plan earlier this year, said this week that around $4.6bn in cash had been declared in the first phase of its program.
The results come as several countries in Latin America have turned to the programs in an effort to either raise cash to contend with crippling government budget deficits or to stimulate investment.
Last year, Chile’s tax amnesty program captured some $1.5bn, or about 10 times the amount originally forecast. Encouraged by Chile’s results, Peru’s Economy and Finance Minister Alfredo Thorne recently said the country is considering a similar plan to help spur domestic investment.
In Brazil, officials said more than 25,000 individuals and companies opted to pay a 15% income tax and a fine in exchange for immunity from possible tax evasion prosecution and other charges and hailed the program a success. At least one prominent Brazilian lawmaker has called for the government of President Michel Temer to roll out another program next year. Brazil’s central bank on Tuesday said Brazilians repatriated some $10bn using the amnesty. The remainder of the money were funds already in the country, officials said.
Argentina, meanwhile, is moving ahead with the next phase of its program. Argentines hold an estimated $400bn abroad, and President Mauricio Macri has sought to persuade his countrymen to repatriate a portion of the funds as he works to jump start the economy.
Argentines still have at least two more deadlines to declare their assets abroad. The government is offering several options to participate, including paying a penalty of as much as 15 percent of their undeclared assets, purchasing government bonds that pay no interest or investing in closed-end mutual funds designed to provide capital for agricultural, housing and infrastructure projects.
“What we’ve done so far is only a small part but it’s very important,” Argentina’s Finance Minister Alfonso Prat-Gay said.