ARGENTINA: PAIS TAX SCOPE AMENDMENT AND NEW PAYMENT ON ACCOUNT.

TaxUpdate

On the 24th, Argentina announced Decree No. 377/2023, expanding the scope of the “PAIS Tax” Regulations approved by Decree No. 99/2019. Key changes include:

1. Taxable Transactions:

Import of services listed in Annex II, provided by non-residents, including Repair and Maintenance, Courier, Insurance Premiums, IT Services, Legal Services, Financial Services, Technical Services, and Research & Development.
Rate: 25%
Acquisition of freight or transportation services abroad for goods’ import/export with Central Bank of Argentina Codes S04, S30, and S31.
Rate: 7.5%
Import of merchandise in the Mercosur Common Nomenclature (MCN), with exceptions.
Rate: 7.5%

2. Exchange Rate Impact:

These changes may increase the USD – ARS exchange rate, leading to higher costs and potentially impacting product/service prices.

3. AFIP Empowerment:

Federal Tax Authorities (AFIP) empowered to establish a payment on account of up to 95% for cases related to the import of goods.

4. General Resolution No. 5393/2023:

Published on July 25th, adjusting regulations to Decree No. 377/2023.
Introduces “PAIS TAX” Payment on Account for import transactions.

Payment on Account Features:

Excludes transactions registered in foreign exchange currency by a third party and those through a PSP/Courier provider.
Calculated over the FOB Value reported in the import destination.
Importer must report advance payments in USD to discount from the FOB Value.
Rates: 28.5% for MCN imports and/or 7.125% for other goods.
Obligation on the importer at the time of official import destination, along with applicable taxes and duties.

For more details, refer to the official publications: Decree No. 377/2023 and General Resolution No. 5393/2023.