The National Government regulation the tax benefits of construction bleaching. The law had been approved last February and enacted in March.
Through Resolution 244/2021, Published this Monday in the Official Gazette, the Government regulated the tax benefits on money laundering for construction, aimed at promoting development or investment in real estate projects carried out in Argentina.
Below we highlight the 8 keys of the regulation:
Who enters the laundering will also have the benefits in earnings and personal property that the Law provides?
No. The regulation clarifies that those subjects who enter into money laundering are not going to enjoy the benefits for investors who use money already declared.
“Let us remember that the benefits consist of an exemption from personal property tax for a maximum of 2 fiscal periods, a payment on account of the personal property tax and a deferral of the income tax or the tax on the transfer of real estate of human persons and undivided inheritance for certain situations “, indicated Sebastián M. Domínguez, from SDC Asesores Tributarios.
Can any subject enter the money laundering?
No. The Law establishes that those who can enter are: human persons, undivided estates and the subjects established in article 53 of the Income Tax Law, residents of the Argentine Republic can adhere to money laundering.
The regulations clarify that the definition of residence must be considered in accordance with art. 116 and following of the Income Tax Law and that those who are as of 03/12/2021 can adhere.
How is the destination of the funds that are externalized in the framework of money laundering implemented?
The funds must be deposited in a Special Deposit and Cancellation Account for Argentine Construction (CECON.Ar) that has not yet been fully or partially regulated by the BCRA, prior to the investment in the real estate project.
The destinations may be the following:
to) Keep them deposited in their currency of origin.
b) In the case of foreign currency, sell them in the Free Exchange Market, through the financial institution where the deposit was made.
c) Apply them temporarily, and for the only time, to the acquisition of national public securities, for their subsequent sale with settlement, exclusively, in legal tender. In those cases in which holdings in foreign currency have been declared, the sale with settlement must be carried out within the term established by the CNV for that purpose.
The investment proceeds will be credited, in national currency, and must be invested in real estate projects referred to in article 2 of the aforementioned law, developed directly or through third parties.
In this way, the regulation fulfills the expected objective. The foreign currency that is externalized may be converted into pesos through an operation with public securities obtaining an implicit exchange rate called “Stock Dollar” or “MEP Dollar”.
What is the maximum date to apply the funds to development or investment in real estate projects?
All declared funds must be assigned to development or investment, in real estate projects, prior to December 31, 2022, inclusive.
Can the deposited funds be used to pay the special money laundering tax?
Not. Deposited funds cannot be used for the payment of the special money laundering tax.
“In our opinion, it should have been allowed to use the funds externalized in the money laundering to pay the special tax since it is one more incentive for the regime,” Domínguez said.
The obligation to pay the tax from 5% to 20% according to the date they are declared Holdings with declared funds can make a resident unable to adhere to the regime.
How is the special money laundering tax determined?
According to the Law, the special tax is determined on the value of the possession that is declared, expressed in national currency at the time of entry to the special account, according to the following rates: a) Entered between 03/12/2021 and on 05/11/2021: 5% b) Income between 05/12/2021 and 06/10/2021: 10% c) Income 06/11/2021 and 07/10/2021: 20% For the valuation of foreign currency, the buyer exchange rate of the Banco de la Nación Argentina that corresponds to the date of its entry into the special account.
The regulations do not provide any clarification.
Do the benefits with respect to the amounts externalized in the money laundering have limitations?
Yes. The regulations define the obligations that are in the course of administrative, contentious-administrative or judicial discussion in the criminal tax, foreign exchange and customs criminal areas, are considered to be included within the releases referred to in article 11 of Law 27,613.
Regarding the release of all civil, commercial, criminal tax, foreign exchange penalties, customs penalties and administrative offenses that may correspond, the regulations indicate that it will proceed at the request of the interested party by submitting to the intervening court the documentation that proves the foster care to the Standardization Program to Reactivate Argentine Federal Construction.
Is it possible to enter money laundering since the first installment of the 5% rate is running?
Not. Regulatory Decree 244/2021 is one more step in the operation of money laundering but the dictates of the AFIP regulations still remain. and from BCRA to be able to join and deposit the funds.
Likewise, the regulations of the CNV are pending for subsequent purchase and sale operations of government securities.
“Unfortunately the law contemplated a very short term for the application of the 5% rate and it is expiring on 05/11/2021,” added the taxpayer.
In this context of the second wave of the Covid and considering the intention of the legislators to promote the construction of new private works through money laundering, we believe it appropriate to send a project to reform the regime so that the 5% tax is extended to the externalizations of funds that are carried out until 12/31/2021, inclusive.
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