03 November 2021 Peru’s President asks Congress for power to enact different tax measures If approved, taxpayers should monitor the release of future guidance. On 27 October 2021, Peru’s President asked Congress for the power to enact different tax measures. If Congress approves the request, the President would be able to enact provisions that would do the following: Modify the rules for deducting expenses and costs for purposes of determining the corporate income tax Modify the rates applicable to individuals for income derived from leasing of immovable property, passive income and any other Peruvian-source income Tax dividend distributions between Peruvian corporations Modify the rates and deductions applicable to labor income obtained by individuals Modify the rates applicable to nonresidents for international activities performed partially in Peru and partially abroad Regulate how associative contracts (silent partnerships) are taxed Establish provisions for unjustified revenue Modify the fair market value rules applicable to securities Modify the mining tax regime, including revising the deductibility of the amount effectively paid as a mining royalty, a special tax on mining, and the so-called special mining burden Create a simplified income tax regime for small companies by allowing the use of electronic accounting books and records, as well as electronic payment vouchers Value-added tax (VAT) and excise tax Establish a mechanism for the collection of VAT in the digital economy (online platforms) Extend the current VAT exemptions Subject life insurance policies to VAT Improve the Peruvian tax authorities’ powers in audits Establish liability for tax advisors who participate in or develop tax avoidance schemes Improve the Tax Identification Registry Modify the rules for using the Peruvian banking system in transactions carried out by taxpayers Modify the provisions in Peru’s legislation for taxes imposed by local governments Establish an accelerated depreciation regime for the aquaculture and forestry sector _________________________________________ For additional information with respect to this Alert, please contact the following: Ernst & Young Asesores S.C.R.L, Lima 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 Document ID: 2021-6138 | 
