January 10, 2024
Argentina to issue 'Bonds for the Reconstruction for a Free Argentina'
On 22 December 2023, the new Argentine Government issued Decree No. 72/2023 (the Decree) related to the Bonds for the Reconstruction for a Free Argentina (Bonos para la Reconstruccion de una Argentina Libre, in Spanish, abbreviated as BOPREAL).
BOPREALs that the Argentine Central Bank (Banco Central de la Republica Argentina or BCRA) issues to Argentine entities that have cross-border debts for imports of goods with customs entry registration and for services, as of 12 December 2023, may be used as payment — at their technical value — for the cancellation of tax (e.g., income tax or value-added tax) and customs obligations, plus interest and fines. The BOREALs cannot be used to pay Social Security taxes, tax on debits and credits, or certain other taxes.
The BOPREAL subscription in Argentine Pesos is subject to the tax on certain purchases of foreign currency (Impuesto PAIS) at a 0% rate for subscriptions made through 31January 2024 and at the rate applicable to the import for subscriptions made from 1 February 2024 onward.
These measures became effective as from 22 December 2023.
As a complement to this Decree, the BCRA also issued Communication "A" 7925, which clarified some points, including that with the collection of the payment of principal and interest in foreign currency of the BOPREALs, the importer may use the funds deposited in its local account to cancel the liabilities abroad for the import of goods and services that originated the BOPREALs subscription.