Argentina

Export duty on services repealed

By virtue of Decree No. 1,201/2018, the Government established a duty on services rendered in Argentina where (i) there is no employment relationship between the supplier and recipient of the service and (ii) the service is used or exploited abroad. This included the exportation of software-related services, as well as consulting services rendered in Argentina and used abroad.

The applicable rate was 5% on the amount invoiced.

The tax was expected to apply temporarily from January 1, 2020 through December 31, 2021. Although there were some rumours about the potential reinstatement of this duty, the Government finally decided not to extend its term. Therefore, as from January 1, 2022, exports of services are no longer subject to the 5% export duty. 

List of low-or-no-tax jurisdictions published

According to domestic regulations a no-or-low tax jurisdiction would be any country, jurisdiction, territory, associate states or special tax regime that imposes a tax on corporate income that is lower than 60% of the Argentine corporate income tax rate (set to 30% for FY 2018,2019 and 2020 and 25%/35% from 2021 on).

Although this objective definition has been in the Income Tax Law since 2018, the Tax Authority has published in its website a list of countries/territories that, according to the above paramethers, would fall within the definition of low-or-no tax jurisdiction. The list can be found in the following link:

List of low-or-no tax jurisdictions

Amendments to the corporate income tax (CIT) rate

On 16 June 2021,List of low-or-no tax jurisdictions Law 27,630, which introduced amendments to the CIT law, entered into force.

The most relevant changes introduced by Law 27,630 are the following:

CIT rate

Under prior law, the CIT rate was 25%. As per the new law applicable to fiscal years starting on or after 1 January 2021, corporate income will be subject to tax at progressive rates ranging from 25% to 35% as follows (amounts are in Argentine pesos [ARS]):

• Taxable income from ARS 0 to ARS 7,604,948.57: 25%.
• Taxable income from more than ARS 7,604,948.57 to ARS 76,049,485.68: ARS 1,901,237.14 + 30% on the amount that exceeds ARS 7,604,948.57.
• Taxable income from more than ARS 76,049,485.68: ARS 22,434,598.28 + 35% on the amount that exceeds ARS 76,049,485.68

These brackets will be annually adjusted to account for inflation as per the consumer price index (CPI) published by the relevant governmental agency (INDEC).

Withholding on dividend distributions

Under prior law, distribution of earnings attributable to FY 2021 were subject to withholding tax (WHT) at a 13% rate. The WHT rate was tied to the prior CIT rate (25%). Law 27,630 reduced the WHT rate on dividend distributions to non-residents from earnings obtained as from FY 2021 to 7%.