The Argentine government launched an initiative aimed at incorporating undeclared dollars held by millions of citizens “under the mattress” into the formal system. Without strict controls or penalties, the plan promises to boost the economy and strengthen public finances, but it also raises concerns about potential money laundering and tax evasion risks. What does this measure entail and what challenges will it face?
The phrase echoes the well-known feminist slogan “Your body, your decision,” which was crucial in the fight for legal abortion in Argentina. In this case, it serves as a calculated provocation, adapting a cultural autonomy catchphrase to convey an economic message of financial freedom.
We need to make a change so that the State respects an elementary truth: what’s yours is yours and you can spend and use it as you please, without having to constantly prove where you got it from, Adorni stated at a press conference on May 22nd.
How does the plan work?
Decree 353/2025 introduces a series of measures to facilitate that undeclared savings can enter the formal system with fewer controls.
Among the main novelties, the obligation to report certain operations is eliminated —as purchases with a card or notarial acts— The amounts above which banks must report their movements to ARCA are increased.
Authorization is granted to make fixed-term deposits without justifying the source of the funds. up to limits of 100 million pesos for individuals and 30 million for companies.
In addition, a simplified regime for the income tax is established, which allows paying a fixed amount based on invoicing, without the need to detail expenses or assets.
From the government, they assure that these measures aim to reduce bureaucracy and foster confidence so that undeclared savings can be integrated into the formal economy, thus injecting fresh dollars into the economic cycle without affecting the Central Bank’s reserves.
The idea is that more money in circulation will generate greater consumption, investment, and activity. However, critical sectors warn that this flexibility could increase the
money laundering risks and demand stricter controls to prevent abuses.
The Executive believes that these funds, hidden under the mattress—literally or figuratively—will boost sectors hit hard like real estate, construction, and the automotive sector. In all cases, these are areas that show some slight recovery, but they are still far from regaining the levels they had in 2023.
In addition, by adding funds to the system that previously did not contribute, the state anticipates an increase in fiscal revenue, which could strengthen public finances and alleviate tensions from the deficit.
Nevertheless, the implementation of the plan is not without obstacles. It requires, among other things, the adherence of the provinces to modify the prescription periods of the Tax Criminal Law. Also,
It would generate friction with international bodies, which demand more rigorous standards of traceability and regulatory compliance.
“Milei pushes forward this initiative at a time when he needs to boost consumption and inject dollars into the economy without directly affecting the reserves. We will have to see if Congress supports this proposal, amid a political landscape marked by the proximity of the electoral process,” explains Juan Ignacio Di Meglio, Senior Public Affairs Director at LLYC, to France 24.
Open the door to legalizing resources from drug trafficking
Although the plan presents potential benefits, some analysts are skeptical about its effectiveness. The historic distrust towards institutions, coupled with the persistent
inflation
and economic volatility has led many Argentinians to prefer keeping their dollars outside the formal system as a way to protect their assets.
In this context, economist Gastón Jamui, founder of Sustainable Livestock, warns that the plan also has negative effects.
“This measure may encourage future evasion. It sends a dangerous signal: that tax evasion has no consequences and that eventually everything can be forgiven. This discourages voluntary compliance with the tax system,” he points out to France 24.
From their perspective, it is also an issue of fairness. “It is unfair for the compliant taxpayer. Many feel that they were foolish for having declared their income and paid taxes, while “others are now being rewarded for having acted outside the law”.
Furthermore, it highlights an even more concerning risk: “The most serious issue is that no justification is required for the origin of the funds.” This opens the door for resources derived from it to be legalized. drug trafficking, corruption or even human trafficking.
The FATF’s gaze: international standards and concerns
The Financial Action Task Force (FATF), the global body created to combat money laundering and terrorist financing, closely monitors such initiatives that facilitate the incorporation of undeclared capital into the financial system.
The organization insists that solid mechanisms of transparency, ‘know your customer’ (KYC), and transaction monitoring must be maintained to prevent illicit money from being laundered under the appearance of legality.
In this regard, the absence of an obligation to justify the origin of funds could be viewed with concern by the intergovernmental body that promotes international cooperation and strict standards on the matter.
Is there a path to endogenous dollarization?
Beyond the fiscal issue, the plan also seems to indirectly promote the idea of a
Dollarization endogenous; that is, a process in which the dollar becomes the de facto reference currency in the economy, without there being a formal decision have it established as the official currency.
Di Meglio points out that, although the Government does not explicitly admit it, this measure reintroduces implicitly the promise of dollarizing the economy, still unfulfilled and, for now, relegated among the official priorities.
The public affairs expert and master’s degree holder in political communication explains that this strategy is part of a context where Argentinians, historically, have turned to the dollar as a refuge against a macroeconomy marked by chronic inflation and instability.
Nicolás Favaron, Public Affairs Program Manager at Edelman and advisor on communication and institutional relations, agrees that the measure is part of a broader strategy linked to dollarization. In an interview with France 24, he states:
This measure is one more within the process of endogenous dollarization that the president proposes. It is another step in that direction.
Nevertheless, he warns that its political viability will depend on legislative support: “For that confidence to be maintained, it is essential to have the support of the governors and for the bill they are going to present to be turned into law.”
Milei’s plan to legalize dollars without controls opens a door that could bring relief to many Argentinians seeking security for their savings, but it also raises doubts about the risks it poses for transparency and tax justice.
Beyond the promises and official rhetoric, it is clear that the true test will be how this measure will be implemented and controlled, and if it will generate the necessary trust in a country accustomed to distrusting its institutions.