Argentina's Central Bank Director Backs 'Digital Peso' to Stabilize Economy and Broaden Tax Base
Summary:
Agustín D'Attellis, the Director of the Central Bank of Argentina, has endorsed the implementation of a central bank digital currency (CBDC), or "digital peso" (PAD), saying it could stabilize the national economy by 2024. Its traceability would expand the tax base without having to raise taxes, and may even lower them, he argued. He added that the PAD, which would be gradually introduced and coexist with cash, could also alleviate competition between the peso and the U.S. dollar, often used as a payment method. This plan has also been backed by Economy Minister and presidential candidate Sergio Massa, as a solution to Argentina's persistent inflation crisis.
Agustín D'Attellis, who holds the position of Director at the Central Bank of the Argentine Republic (BCRA), has publicly endorsed the Minister of Economy, Sergio Massa, in his endorsement of the central bank digital currency (CBDC) as a solution for the country's economy. D'Attellis offered his viewpoint on a local TV station, declaring his conviction that the "digital peso" (PAD) could potentially stabilize Argentina's economy by 2024 or even earlier. In the opinion of the director, the primary benefit of the CBDC is its traceability, which could aid the government in taxation: “With a digital currency, transactions are traceable, not to learn who conducted them, but to verify their occurrence, thereby expanding the tax base. This could potentially lead to higher revenue collection without a need for tax hikes, and may even result in a reduction in tax rates." The PAD can also alleviate the nation's monetary issues, since the considerably volatile local currency, the peso, frequently ends up rivaling the American dollar as a medium of exchange. Furthermore, D'Attellis provided a categorical explanation regarding the "digital peso", stating that the CBDC would be phased in over time, coexist alongside physical cash, and would only replace tangible bills in the final phase of the initiative. On October 2, Sergio Massa, who is currently the Minister of Economy and a presidential candidate, pledged to initiate a CBDC to address Argentina's enduring inflation problem if he is elected. According to surveys, Massa is slightly behind Javier Milei, a candidate that supports Bitcoin and opposes central banks, and intends to establish the United States dollar as Argentina's official currency.
Published At
10/5/2023 9:03:26 AM
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