Caputo relaunches $170bn dollar amnesty to deepen banks
Argentina has relaunched a tax amnesty removing previous wealth caps to coax an estimated $170 billion in informal dollar savings into the banking system, a high-stakes bid to expand credit and stabilize the peso.
Argentina’s government has relaunched a program allowing citizens to deposit undocumented US dollar cash into the financial system without facing tax penalties or questions about its origin. Administered by the tax and customs enforcement agency ARCA, Economy Minister Luis Caputo is spearheading the initiative to unlock an estimated $170 billion held outside the formal banking sector.
The scheme is a revised version of a law passed in December 2025 that failed to attract significant participation due to confusing rules and strict income and wealth caps. This iteration drops those caps entirely and pairs the amnesty with adjustments to income tax, broadening eligibility in a bid to overcome the low uptake that plagued the first attempt.
For a financial system starved of foreign currency, even a partial success could be transformative. Argentine banks are unusually small relative to the size of the broader economy, meaning an influx of dollars would directly expand available credit for businesses and consumers. The additional liquidity would also bolster central bank reserves and help steady the historically volatile peso.
The massive cash pool is a rational response to decades of inflation, sovereign defaults and frozen bank accounts, which conditioned citizens to trust physical dollars over domestic institutions. Caputo estimated the hoard at more than four times the formal dollar deposits in the country. “Keeping dollars under the mattress is a very bad deal,” Caputo argued, urging savers to put idle money to work.
However, the government faces a deep trust deficit. Past amnesties have ended poorly, leaving savers wary of state promises regardless of new legislation. Furthermore, critics and international watchdogs are likely to scrutinize the lack of origin checks, warning that the amnesty could serve as a conduit for laundering illicit funds. The government maintains the target is ordinary household savings already inside the country.
For foreign investors, the plan serves as a litmus test for President Javier Milei’s broader market-friendly agenda. Coaxing these hidden dollars into the open is now a core component of the administration's gamble to stabilize the economy and prove that lowering taxes and shrinking the state's reach can deliver tangible growth.
