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August 23, 2021

Uruguay establishes tax incentives for investments in aeronautical infrastructure projects

Companies that invest in aeronautical infrastructure projects may qualify for exemptions from corporate income tax, net wealth tax and value-added tax.

With the aim of increasing mobility, increasing the number of international flights from and to Uruguay, and complying with international quality standards, Uruguay’s Executive Power has established tax incentives (Decree 248/021) for public concession companies (i.e., companies chosen by the Government to do a certain job) that invest in aeronautical infrastructure projects.

Specifically, the decree extends the tax exemptions established in Law No. 16,096 (Investment Law) to investment projects involving the construction, remodeling, expansion, maintenance, and operation of national and international airports. To qualify for the incentives, a company must submit the investment project to the Commission for the Application (COMAP), which will evaluate the project and recommend it for approval to the Executive Power. If the Executive Power approves the project, the income from the project will be exempt from corporate income tax, net wealth tax and value-added tax. The amount of the corporate income tax exemption will depend on the score given to the project by COMAP. The decree, however, established that the maximum amount of the exemption is 90% of the tax to be paid. The goods and services used in the project will be exempt from import taxes.

Eligible investments include all the goods and services used in the promoted activity. The goods and services must be used (1) in the project in the tax year in which the company applies for the incentives, (2) six months before the month the company submits the application for the incentives or (3) throughout the project until the end of the concession’s term.

Decree No. 248/021 was published in the Official Gazette and went into effect on 6 August 2021.


For additional information with respect to this Alert, please contact the following:

EY Uruguay, Montevideo

Ernst & Young LLP (United States), Latin American Business Center, New York

Ernst & Young Abogados, Latin America Business Center, Madrid

Ernst & Young LLP (United Kingdom), Latin American Business Center, London

Ernst & Young Tax Co., Latin American Business Center, Japan & Asia Pacific


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