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10 April 2023

Argentine tax authorities suspend the validity of exemption certificates for income tax and VAT withholdings on imports of goods

  • The Argentine tax authorities published General Resolution 5339, suspending until 31 December 2023 the validity of exemption certificates for income tax and value added tax withholdings on imported goods.
  • Potentially affected taxpayers should assess the impact of the Resolution, as the changes could have a significant financial impact.

Background

In August 2007, the Argentine tax authorities (AFIP) published General Resolution No. 2281/2007 (2281 Resolution) in the Official Gazette. The 2281 Resolution established a reverse withholding income tax regime applicable to definitive imports of goods. This regime imposed a 6% withholding tax on the total of the price subject to import duties, the customs duties and import taxes.

The regime included an exemption for taxpayers with valid exemption certificates on income tax withholdings granted by AFIP, under the provisions of Section 38 of General Resolution No. 830.

In November 2010, General Resolution No. 2937/2010 (2937 Resolution) introduced a 20% reverse withholding value added tax (VAT) regime applicable to definitive imports of goods subject to the general 21% VAT rate (or 10% withholding rate applicable to goods subject to the reduced 10.5% VAT rate). The 2937 Resolution included an exemption for taxpayers with recurrent VAT balances and valid AFIP exemption certificates on VAT withholdings.

Resolution 5339

General Resolution No. 5339/2023 (the Resolution), published in the Official Gazette on 29 March 2023, suspends the validity of exemption certificates on income tax and VAT withholdings on importations of goods until 31 December 2023.

The Resolution also states that VAT withholdings made on goods imported until 31 December 2023 may be credited against the taxpayer's VAT liability as of the ninth fiscal period following the import date, rather than in the same month the goods were imported, as was contemplated previously.

Taxpayers will not be permitted to deduct the income tax reverse withholdings when calculating prepayments for the next fiscal year to which they correspond.

The Resolution also establishes that exemption certificates should not be suspended for the following imports:

  • Imports for consumption by micro- and small-sized companies with valid "MiPyME" certificates
  • Imports for consumption by the National State
  • Imports for consumption that are exempt from national taxes under Law No. 27,701 General Budget for Fiscal Year 2023

Local taxpayers with current exemption certificates for income tax and VAT withholdings should assess the Resolution's impact, as these changes could have a significant financial impact.

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

Pistrelli, Henry Martin & Asociados S.R.L., Buenos Aires

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

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

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

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor

Document ID: 2023-0690

 
 

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