Global

Details

  • Service: Tax, International Corporate Tax, International Executive Services, Global Compliance Management Services
  • Type: Regulatory update
  • Date: 7/16/2012

Argentina - Tax treaty with Spain ends in 2013 

July 16:   The income tax treaty (1992) between Argentina and Spain will cease to be in force as of 1 January 2013.

A notice published on 12 July 2012 in Argentina’s official bulletin (Boletín Oficial de la República Argentina) announced the cancellation of the tax treaty with Spain, effective beginning in 2013. This action is pursuant to Article 29 of the treaty on “cancellation.”

Consequences for taxpayers

With this action, among taxpayers to be principally affected are Argentine corporations; they will be required to pay Argentine tax on the personal assets of their Spanish shareholders (which is imposed at a rate of 0.5% on a basis equal to the Spanish shareholders’ percentage of their Argentine net worth).


Other implications concern increased rates of withholding tax on payments made from Argentina to Spain.


  • Payments related to royalties will be subject to Argentine withholding tax at source at a rate of 21%, 28% or 31.5%.
  • Dividend distributions will be subject to Argentine withholding tax at a rate of 35%.
  • Payments of interest will be subject to Argentine withholding tax at a rate of 35%.

KPMG observation

This is the second income tax treaty that Argentina has cancelled in recent weeks. See, e.g., TaxNewsFlash-Americas: Argentina - Tax treaty with Chile ends in 2013



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


Rodolfo Canese

+54 11 4316 5869


Violeta Lagos

+54 11 4891 5619


Mariel Vazquez




©2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. All rights reserved.


The KPMG logo and name are trademarks of KPMG International.


KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever.


The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.


Direct comments, including requests for subscriptions, to go-fmtaxnewsflash@kpmg.com.
For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at:

+ 1 202 533 4366

1801 K Street NW
Washington, DC 20006.

 

Share this

Share this

Subscribe

Subscribe to receive the latest TaxNewsFlash email alerts (you must select the option for TaxNewsFlash)


Already a Subscriber? Login


Not a member? Subscribe now

Contact us