Argentina modernizes tax agency with IDB support to boost development

Argentina is embarking on a comprehensive, long-term transformation of its tax administration agency, ARCA, with crucial support from the Inter-American Development Bank (IDB). This modernization effort aims to bolster the state's capacity, drive digitalization, enhance services for taxpayers, and foster advanced, data-driven management.

The initiative moves beyond simply increasing tax collection. It emphasizes how the state collects revenue, recognizing that a strong, modern tax administration yields lasting benefits for taxpayers. Countries that have significantly reduced evasion often succeeded not through harsher penalties or higher taxes, but by investing in technology, integrated risk management, institutional strengthening, and quality digital services.

Advanced analytics, artificial intelligence, and automation are key tools in this transformation. They enable more precise controls, better risk identification, taxpayer segmentation, and cost reduction for compliance. However, the challenge extends beyond technology, requiring strengthened human capabilities, adapted processes, and more modern, transparent, taxpayer-oriented institutions.

Ultimately, an efficient tax administration simplifies processes, builds trust, and strengthens the relationship between citizens and the state. This modernization is viewed as a cornerstone for Argentina's fiscal policy, supporting the government's stabilization plan and enhancing the country's competitiveness by reducing business costs and improving the investment climate.