The Argentine Congress, on December 23, 2019, approved the Social Solidarity and Productive Reactivation Law (the Law) to align public accounts, boost the economy, and reduce social inequalities. The Law introduces relevant changes to the Argentine tax system, including a suspension of the 2018 corporate income tax rate reduction, an increase in the wealth tax rate, the reinstatement of certain tax exemptions on investment income in Argentine securities, and a new tax on outbound payments for specific transactions. The Law includes changes to customs duties rules on exports of goods and services and also to employment taxes.
While taxpayers are still digesting the 2018 tax reform, these latest tax law changes represent a significant challenge since the new rules amend, postpone, roll-back or even repeal the 2018 changes.
The recent changes to the tax law require analysis of the potential impact on the day-to-day operations of local and multinational companies in Argentina.