Details

Service: Tax, International Corporate Tax, Global Compliance Management Services
Type: Regulatory update
Date: 2/8/2012

Argentina - Anti-tax evasion plan, pending legislative consideration, includes change to taxation of transfers of shares

February 8: A proposal pending legislative consideration by Argentina’s congress is one developed by the Argentine tax authorities (AFIP). The project—known as “Anti Tax-evasion Plan III” (Plan Antievasión III)—would make changes to the income tax law.

Among the proposals are measures concerning:

The transfer of shares—For non-residents, the pending legislation would repeal section 78 of Decree 2284 (31 October 1991) (which provides an income tax exemption for gain realized from the sale of shares, bonds or other types of marketable securities for foreign beneficiaries). Thus, under the proposal, gain / income realized by non-residents on the transfer of shares—whether listed or not on a stock exchange—would be taxable in Argentina.

Payments made into “tax haven” jurisdictions—The legislation proposes that such payments would not be deductible for Argentine tax purposes and that under a “notional income” concept, Argentine-source taxable income would be deemed to be 100% of the gross payment. Accordingly, the 35% withholding tax rate would apply to payments made into a tax haven. This treatment would apply to transactions of any nature, for payments to persons or entities located in tax haven jurisdictions, as well as for transactions conducted by foreign entities using accounts with banks or financial institutions located in a tax haven jurisdiction. This provision, however, would not apply in instances when there is an income tax treaty in force.

These changes will only be effective once enacted; at present, these amendments are not effective because they have not been passed by the Argentine congress.

For more information, contact a KPMG tax professional in Argentina:

Rodolfo Canese,

+54 11 4316 5869

Violeta Lagos,

+54 11 4891 5619

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