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December 18, 2023

Argentina implements new economic measures with impact on tax and foreign exchange matters

  • The recently inaugurated Argentine Government has announced a series of emergency measures.
  • The package includes measures affecting tax and foreign exchange matters.
  • Significant devaluation of the Argentine Peso was included as part of the measures.

The recently inaugurated Argentine Government announced, on 12 December 2023, a series of emergency measures to address the current economic situation. Among the measures' main objectives are reducing the fiscal deficit and regularizing the foreign exchange market.

The package of measures includes an increase in the official exchange rate to an average of 800 Argentine Pesos (ARS 800) per USD (on 13 December, the exchange rate at the Banco de la Nación Argentina was ARS 780 for purchase and ARS 820 for sale) — previously, the average exchange rate was ARS 365. The measures also included cuts in public expenditures, reduced energy and transportation subsidies, increases in certain taxes and the elimination of some restrictions on imports and access to the foreign exchange market.

Highlights of the main tax and foreign exchange measures follow.

Differential exchange rate for exports

Decree No. 28/2023, published in the Official Gazette on 13 December 2023, establishes that 80% of the value of goods and services rendered in the country and used or exploited abroad must be entered into the country in foreign currency and/or negotiated through the Free Foreign Exchange Market (FFEM or "Mercado Libre de Cambios" in Spanish), and the remaining 20% through purchase and sale operations in negotiable securities acquired with settlement in foreign currency and sold with settlement in local currency.

The rule clarifies that the payment of the corresponding export duties must be made based on the value provided for in the previous paragraph.

Increase in "tax for an inclusive and supportive Argentina" on certain transactions

On 23 December 2019, the Argentine Government enacted Law No. 27,541. Among the changes implemented, this tax reform law established a new tax on certain purchases of foreign currency ("Impuesto PAIS," in Spanish), including the purchases of foreign currency intended for acquiring certain goods and services from abroad.

Decree No. 29/2023 (Official Gazette 13 December 2023), increased the Impuesto PAIS rate applicable to certain operations, according to the following:

  • The acquisition abroad of freight services and other transportation services for import or export of goods, or their acquisition in Argentina when provided by nonresidents, will be subject to a 17.5% Impuesto PAIS (previously the rate was 7.5%).
  • The import of goods will be subject to a 17.5% Impuesto PAIS (previously 7.5%); it should be noted that the following imports continue to be exempt from the tax:
    • Certain goods related to the oil industry (fuels, lubricants, etc.)
    • Certain goods related to the basic food basket, as established by the Ministry of Economy
    • Other goods related to the generation of energy

These measures will take effect for foreign currency purchases carried out on or after 13 December 2023, inclusive, aimed at canceling the aforementioned transactions.

In line with these modifications, the Federal Administration of Public Revenues ("Administración Federal de Ingresos Públicos" or AFIP, in Spanish), through General Resolution No. 5464 (Official Gazette 12/13/2023), increased to 16.625% (previously 7.125%) the prepayment requirement on Impuesto PAIS for the importation of goods now subject to 17.5% tax, according to the modification of Decree No. 29/2023.

The increase in the prepayment will apply to import destinations formalized since 13 December 2023.

It should be noted that the rates applicable to payments for services, generally 25%, and for imports of luxury goods, generally 30%, remain in force without changes.

Reduction of Income Tax and Personal Assets Tax reverse withholdings

General Resolution (AFIP) 4815 (Official Gazette 16 September 2020) and amendments, established a reverse withholding regime for Income Tax and Personal Assets Tax on certain purchases of foreign currency.

Through General Resolution (AFIP) No. 5463 (Official Gazette 13 December 2023), the reverse withholdings of Personal Assets Tax on purchases are eliminated (previously the rate was 25%), and reverse withholdings on Income Tax are reduced to 30% (previously they amounted to 100%).

These reverse withholdings will be considered as tax credits for the local taxpayers and will be creditable in their annual Income Tax return (for taxpayers registered in that tax) or in the annual Personal Assets Tax return (for individual taxpayers registered in the "Monotributo" — a simplified individual tax regime — that are not registered in Income Tax) corresponding to the fiscal year in which the tax was withheld (previously they could be credited in the fiscal year subsequent to the one in which they had been withheld).

These modifications will apply to operations carried out after 13 December 2023.

Access to the FFEM — Communication "A" 7917 of the Central Bank of Argentina

Effective as of 13 December 2023, the Central Bank of Argentina ("BCRA" in Spanish) issued Communication "A" 7917 establishing a series of modifications for accessing the FFEM for payments of goods and services abroad.

Payment of imports of goods

  1. It will not be necessary to have a "SIRA declaration" (electronic procedure to manage importation of goods, in which AFIP, Customs, BCRA and the Secretary of Commerce are involved) or to validate the operation in the system "Cuenta Corriente Unica de Comercio Exterior" (CCUCE).
  2. Access to the FFEM may be granted, without prior approval from the BCRA, to make deferred payments for new imports of goods with customs entry registration since 13 December 2023, according to the following schedule:
    1. From the date of the customs entry registration: applicable to petroleum oils or bituminous minerals, their preparations and their residues; petroleum gases and other gaseous hydrocarbons; unagglomerated bituminous coal; and electrical energy
    2. From 30 days after customs entry registration: applicable to pharmaceutical products and/or inputs used in their local production; other goods related to health care or food for human consumption; and fertilizers and/or phytosanitary products and/or inputs that can be used for local production
    3. From 180 days after customs entry registration: applicable to finished automobiles among others
    4. The remaining assets not included in the previous points will have their payment schedule as follows (counted from the date of the importation):
      1. 25% as from 30 calendar days
      2. An additional 25% as from 60 calendar days
      3. Another additional 25% as from 90 calendar days
      4. The remaining 25% as from 120 calendar days
    5. Freight and insurance: When they are part of the purchase conditions agreed upon with the seller, they may be paid in full from the first date on which the importer has access to the FFEM for the related goods.
  3. The rule contemplates the possibility of accessing the FFEM prior to the schedule provided for in point 2, above, in cases where the importer has some type of import financing or enters and liquidates foreign currency from a financial debt or advance collections/prefinancing of exports.

Payment of service imports

  1. It will not be necessary to have a "SIRASE declaration" (electronic procedure to request authorization to make payments of services abroad) or to validate the operation in the CCUCE system.
  2. Payments to unrelated parties for services rendered since 13 December 2023 (with certain exceptions) may be made after a period of 30 calendar days from the date of rendering or accrual of the service.
  3. Payments to related parties rendered since 13 December 2023 (with certain exceptions) may be made after a period of 180 calendar days from the date of rendering or accrual of the service.


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


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