Software companies and others in the knowledge-based economy are noting a surprising development in Argentina, where the tax regime benefiting companies in the knowledge-based economy has been put on hold.
Guest post from Bergstein Law of Uruguay
On June 28, 2019 the European Union and the MERCOSUR group − comprised of Argentina, Brazil, Paraguay and Uruguay − reached a mutual understanding over a trade agreement. Both sides have been negotiating such an agreement for 20 years. European Commission President Jean-Claude Juncker calls this the largest trade agreement the European Union has ever concluded.…
Argentina’s new Law 27,430 introduces a new taxable event: a Value Added Tax (hereinafter VAT) applicable to the importation of “digital services” rendered by a non-resident to a resident individual or entity when the effective use or exploitation of the service is carried out inside Argentina.
An earlier regulation, Decree 354/2018 of April 23, 2018, a deficient attempt to regulate the VAT applicable on digital services, was recently repealed.
According to the current wording of the VAT Law and its Regulatory Decree, VAT applicable to the importation of digital services has the characteristics that are detailed below.
The Argentine executive branch has established new export duties applicable to goods and services. These new export duties were established by a Decree of the Executive Power (Decree No. 793/2018) issued on September 3, 2018 and published at the official Gazette on September 4, 2018, with immediate effect for the export of goods.
The effective date for the application of export duties on services is expected to be January 1, 2019, as the government would need Congress to enact a law providing for such export duties.
The new export duties on goods and services are among the measures being applied by the Macri Administration with the goal of reducing Argentina’s fiscal deficit.
The new export duties, which amount to 12 percent of the value of the exported goods and/or services, include a cap of AR$3 or AR$4 for each US dollar of exports, depending on the kind of exported good or service. These new export duties apply in addition to any other export duties already in force.
The authority of the executive branch to create or impose taxes or import/export duties without Congressional approval is questionable. Although the Argentine Customs Code provides the executive branch with wide power to establish import/export duties, such delegation has been challenged before the federal courts on constitutional grounds.
The Argentine Federal Supreme Court, in its ruling in Camaronera Patagónica, dated April 15, 2014, established that the executive branch is not entitled to create or impose taxes or export duties, even when reasons of urgency, crisis or financial needs are invoked, claiming that, pursuant to the Argentine Constitution, taxes fall under the scope of the legislative branch’s authority, not the executive’s.
DLA Piper Argentina’s tax team has initiated a protective action (amparo) and requested an injunction before the federal courts, in order to challenge the constitutionality of Decree No. 793/2018.
This is a guest post of RCTZZ Abogados in Argentina.
Argentina’s Financial Information Unit (FIU), the governmental authority that enforces the law on prevention of money-laundering activities and terrorism financing has introduced a resolution stating…
Argentina’s Act 26,737, enacted in 2011, restricts foreign ownership of rural real estate. The restrictions imposed by Act 26,737 are relevant for any project that involves acquisition of rural land in Argentina .
The Act imposes several limitations. Under the Act and its applicable amendments, foreign ownership is defined as any acquisition, transfer of ownership or possession rights, whatever the type or name granted by the parties or duration of the same, in favor of a series of points, set forth below. …