Tax News International
Key updates on tax matters:
Argentina
The Federal Public Revenue Administration (AFIP) shall be dissolved and the Tax and Customs Collection and Control Agency (ARCA) shall be created.
Decree 953/2024 – Buenos Aires, 10/24/2024
Creation of the Tax Collection and Customs Control Agency (ARCA)
The dissolution of the Federal Administration of Public Revenue (AFIP) is planned, along with the creation of the Revenue and Customs Control Agency (ARCA), an autonomous entity dependent on the Ministry of Economy. This measure reorganizes revenue and customs control functions, establishing a new framework for managing and overseeing fiscal and customs revenue.
1. Dissolution of AFIPThe decree establishes the dissolution of the AFIP, an autonomous entity of the Ministry of Economy, as the first step in reorganizing tax collection and control mechanisms. This dissolution has specific effects and scope as determined in the decree.
2. Creation of the Tax Collection and Customs Control Agency (ARCA)ARCA is created as an autonomous entity attached to the Ministry of Economy, with the responsibility of assuming the customs collection and control functions previously assigned to AFIP.
3. Executive Directorate of ARCAThe ARCA will be managed by an Executive Director, appointed by the National Executive Branch. The decree establishes that the Executive Director will have a four-year term, which may be renewed for successive periods. To be renewed, the incumbent must comply with the Management Plan of the previous term. In case of vacancy of the position before the term is completed, the replacement will be appointed for the remaining time of the term.
4. Organizational Structure of ARCAThe Chief Executive Officer will be accompanied by a Director General of the Directorate General of Revenue and a Director General of the Directorate General of Customs, in addition to several Deputy Directors General. The decree establishes that the number and competencies of the Deputy Directors will be determined by the National Executive Branch. The Directors General will be appointed and removed by the Executive Branch, while the Deputy Directors and heads of Organizational Units will be appointed by the head of ARCA.
5. Transfer of Resources, Personnel, and Assets from AFIP to ARCA: The decree transfers all resources, personnel, assets, budget, property, commitments, rights, and obligations of AFIP to ARCA. It also guarantees that personnel will maintain their assigned positions and administrative careers unchanged. This ensures continuity in the functions and rights of personnel within the new entity.
6. Legal Continuity of the ARCAThe ARCA is established as the legal successor to AFIP, assuming its responsibilities, competencies, and functions within the current legal framework. This legal continuity will remain in effect until the publication of the regulations and the organizational and functional structure that define the new framework for ARCA, as stipulated in Article 9 of the decree.
7. Powers and Scope of the ARCAThe decree establishes that ARCA will exercise all functions previously.
8. Budget and Financing of the ARCAUntil the budgetary adjustments are made, the operating expenses of ARCA will be covered with the resources provided in AFIP's budget. For tax, banking, and internal operating purposes, related to the collection and distribution of funds, ARCA will use AFIP's Single Tax Identification Key (CUIT), in accordance with the provisions of Article 1 of the decree.
9. Proposed ARCA Rules and StructureThe Executive Director of ARCA shall present a proposal for regulations to the National Executive Branch, defining the competencies, powers, rights, and obligations of the new entity, along with its organizational and functional structure. This proposal must be submitted within 60 business days following the entry into force of the decree.
10. Social Security AppealsThe General Tax Directorate of ARCA will be responsible for managing social security-related resources. This responsibility will allow ARCA to maintain comprehensive management over these resources, which were previously under the purview of AFIP.
11. Supplementary and Clarifying RegulationsThe Ministry of Economy will be responsible for issuing the complementary and clarifying regulations necessary to facilitate the implementation of the decree. This includes the issuance of additional guidelines that may be required to ensure an effective transition and compliance with ARCA's new organizational and administrative guidelines.
12. Validity of the DecreeThe decree will take effect from the moment of its publication, at which point the dissolution of AFIP will be official and the creation of ARCA will be formally established, thus allowing the reorganization of collection and customs control functions under the new entity.
https://www.boletinoficial.gov.ar/detalleAviso/primera/316055/20241025
CHILE
Law No. 21,713: Rules to Ensure Compliance with Tax Obligations
Law No. 21,713 aims to ensure compliance with tax obligations and strengthen mechanisms against tax evasion and avoidance, while also promoting tax sustainability through incentives for transparency. Below, we will detail the main provisions and changes introduced by this law.
Reforms to the Tax Code to Reduce Ambiguities
The law corrects ambiguities in existing tax provisions to clarify the regulatory framework and reduce the scope for interpretations that may facilitate evasion. For example, the definition of evasion is clarified to include acts or legal transactions that, although legitimate, are designed with the purpose of avoiding tax payments. This includes both simulation strategies and abuse of legal provisions, and sanctions are applied to taxpayers who intentionally employ these tactics to reduce their tax obligations.
2. New Inspection and Control Standards
To improve tax enforcement, the law empowers the Internal Revenue Service (SII) with additional tools. From now on, the SII has the power to carry out more in-depth and systematic review procedures for taxpayers who show signs of tax avoidance practices.
Additionally, the SII is authorized to apply specific auditing procedures to complex transactions. In cases where tax evasion is identified, sanctions can be applied regardless of other tax benefits or special regulations. This authority also extends to a series of actions that, taken together, result in a reduction of the taxable base or the deferred fulfillment of tax obligations. With these rules, the SII can sanction isolated acts or sets of acts that, when analyzed in their entirety, demonstrate an intention to evade taxes.
3. Strengthening the SII's Powers for Better Fiscal Results
The law assigns new functions to the SII, including the possibility of conducting audits through remote and electronic means, thereby expanding its jurisdiction. This measure allows for the optimization of audit processes in different regions and facilitates taxpayers' access to their obligations, especially in territories where the physical presence of offices is limited.
In addition, an Executive Committee is being created within the SII, tasked with approving recommendations related to penalties, audit procedures, and criteria for the application of anti-avoidance rules. This committee will also evaluate cases of institutional interest—those that, due to their scale or impact, require special attention from the tax authority. This centralized approach allows for more rigorous oversight and a swift response in implementing the law.
4. Tax Advisory: Oversight and Evaluation of Tax Policies
The Tax Council oversees key aspects of the tax management plan and regulation enforcement. One of its primary functions is to review and provide opinions on circulars and regulations that affect taxpayers before their implementation. This council actively participates in the annual evaluation of the Tax Compliance Management Plan, and the results will be published on the SII website, promoting transparency and public access to information about tax policies and compliance.
5. Tax Sustainability Incentives
The law introduces the concept of tax sustainability as a framework for voluntary cooperation in tax compliance. Taxpayers who adopt transparency and cooperation practices with the SII can obtain an annual certification indicating their compliance with tax sustainability standards. This certification, granted by accredited companies, demonstrates the taxpayer's commitment to fiscal transparency and responsibility.
The SII also maintains a tax transparency registry, which includes those taxpayers who obtain certification or have signed tax sustainability agreements. This public registry acts as an incentive, helping companies demonstrate their social responsibility and alignment with tax compliance policies.
6. Modernization of Notification and Representation Procedures
To improve communication and reduce administrative procedure times, the law stipulates that the SII (Servicio de Impuestos Internos) carry out electronic notifications to taxpayers instead of using traditional methods. However, for those without access to electronic means, notification by registered or personal letter is permitted, ensuring that all taxpayers, regardless of their technological resources, can be aware of their obligations.
Furthermore, taxpayers have the option to designate representatives to act on their behalf before the SII, simplifying procedures and ensuring that they are carried out promptly and formally. This measure facilitates compliance with tax obligations in cases of corporate representation or when the taxpayer cannot personally attend to their tax matters.
7. New Deadlines and Inspection Procedures to Ensure Efficient Compliance
To improve inspection efficiency, new deadlines and rules are established for SII procedures. The time allocated for inspections will depend on the type of review and the complexity of tax operations, with standard deadlines of up to 12 months, which in special cases may be extended to 18 months.
Audits may cover transfer pricing operations, business reorganizations, and transactions between related companies, ensuring a comprehensive analysis of tax effects. In the case of business groups, a unified audit procedure is allowed, reviewing all group operations together, which facilitates the comprehensive supervision of large taxpayers.
For cases where new relevant background information arises, the SII may open additional review procedures without interfering with taxpayers' rights, provided that they concern facts other than those previously audited.
8. Adjustment of the Penalty Interest Rate in Cases of Tax Payment Default
The law establishes an adjustment to the penalty interest rate applied to taxpayers who fail to meet their tax obligations within the established deadlines. This interest rate will be calculated based on the current rate applicable to transactions with a term of one year or more, increased by 3.5%. In addition, the SII will publish the applicable interest rate every six months, allowing for continuous updates based on economic conditions.
This measure seeks to deter tax delinquency, encouraging taxpayers to make their payments on time and minimize the impact of accumulated debt.
9. Exemptions and Flexibility in Special Procedures
The law implements several changes in procedures to improve flexibility in the treatment of certain cases:
- The forgiveness of tax debts will not be allowed for taxpayers convicted of corruption offenses.
- In cases of inquiries regarding anti-avoidance rules, taxpayers must specify which specific rule they wish to consult, thereby limiting the scope of these inquiries.
- The SII can request detailed banking information as part of an audit process, always specifying the type of transactions and the corresponding period, which ensures that the reviews are relevant and focused.
Conclusions
Law No. 21.713 represents a comprehensive reform in Chile's tax administration and compliance, introducing regulations that strengthen fiscal control and promote a culture of tax sustainability. Through a broader oversight framework and a strict timeline structure for inspections, the law enhances the SII's (Internal Revenue Service) capacity to ensure effective tax compliance, sanctioning avoidance and evasion while creating incentives for transparency and corporate social responsibility in fulfilling tax obligations.
Panama
Tax Mor
Through Law 446 of October 28, 2024, a tax moratorium is established that allows taxpayers, both individuals and legal entities, to regularize their tax debts with the General Directorate of Revenue.
Goals of the Moratorium
The moratorium seeks not only to facilitate the regularization of taxpayers in arrears but also to improve tax collection to finance state investment projects and social works. Through this measure, it is intended to contribute to the country's fiscal stability by giving taxpayers an exceptional opportunity to meet their tax obligations without the burden of penalties.
Term and Scope of the Moratorium
The moratorium will be available until December 31, 2024. Taxpayers in default will have the option to pay only the principal balance of their debts without having to cover additional interest, surcharges, or penalties.
Taxes Included in the Moratorium Benefit
The moratorium covers several taxes, most notably:
- Income Tax.
- Real Estate Tax.
- Business Operation Tax.
- Tax on the Transfer of Tangible Movable Goods and Services (ITBMS).
- Selective Consumption Tax (ISC).
- Single Fee for Legal Entities, including fines for the reinstatement of this fee.
Moratoria for Withholding Agents
The measure also applies to withholding agents who have outstanding debts for taxes withheld up to June 2024. In this case, taxpayers can regularize withholdings for income tax and educational insurance without additional interest or penalties, provided they make the payment before December 31, 2024.
Channels of Attention and Advice for Taxpayers
To facilitate access to the moratorium, the DGI has enabled various communication and information channels:
- Web portal: https://dgi.mef.gob.pa.
- Official social media of the DGI.
- Nationwide service offices. Additionally, special service hours will be announced, including Saturdays, for those who wish to take advantage of the moratorium.
Government Commitment to Fiscal Stability
Law 446 reaffirms the National Government's commitment to fiscal stability by providing taxpayers an opportunity to catch up on their taxes without penalties. This provision reinforces the government's commitment to fostering fiscal responsibility and facilitating tax compliance.
Specific Legal Provisions of Law 446
- Article 1: Grant.
- Article 2: It establishes that the moratorium applies to all natural and legal persons, and real estate in administrative or coercive default. Taxpayers can pay the nominal balance owed and be exempt from interest, surcharges, and executive collection penalties.
- Article 3: Specify that withholding agents with debts in taxes withheld up to June 2024, such as income tax and educational insurance, can extinguish their balances by paying directly to the DGI before December 31, 2024.
- Article 4: This Law comes into effect upon its promulgation.
Conclusion
Law 446 represents an effort by the Government to promote economic stability and provide tax relief to taxpayers. With this moratorium, it is expected to facilitate tax regularization, improve tax collection, and allow for the financing of programs and projects for the benefit of the population.
https://dgi.mef.gob.pa/LDRd/Leyes/Ley%20446%20de%2028%20de%20octubre%20de%202024%20Moratoria.pdf
COLOMBIA
Modifications to the DI
Resolution 000119 of July 30, 2024
1. Introduction and Objectives
The Resolution 000119 of July 30, 2024, issued by the Special Administrative Unit National Directorate of Taxes and Customs (DIAN), is enacted to amend and add provisions set forth in Resolution 000165 of November 1, 2023, which regulates the electronic invoicing system in Colombia. The amendments aim to update the invoicing system to facilitate the implementation of the electronic equivalent document and to adapt to the new technological and operational requirements of regulated entities.
2. Context and Legal Basis
The issuance of this resolution is based on specific powers, such as items 2 and 40 of Article 8 of Decree 1742 of 2020, the Article 616-1 of the Tax Code and the Chapter 4 of Title 1 of Part 6 of Book 1 of Decree 1625 of 2016 (Single Regulatory Framework for Tax Matters). These powers allow the DIAN to implement changes that optimize the invoicing system and extend the deadlines for the implementation of certain documents.
The resolution addresses several specific needs, such as the removal of certain restrictions on the issuance of equivalent documents, the extension of deadlines for their implementation, and the adoption of adjustments to the graphic representation of electronic invoices.
3. Modifications to Resolution 000165 of 2023
Resolution 000119 makes detailed changes and additions to specific articles of Resolution 000165. The most relevant aspects of each change and addition are presented below:
a. Modification of Article 4, Paragraph 4
- Original Text: Resolution 000165 established that equivalent documents did not have to be electronic in some cases.
- Modification The amendment removes the expression “as long as they do not correspond to equivalent electronic documents,” allowing liable subjects to issue either a Electronic sales invoice or one equivalent document, in physical or electronic form. This modification increases flexibility in issuing invoices or equivalent documents, according to the subject's needs.
b. Modification of Article 23, Paragraph 2
- Extension of Implementation Deadline: To allow those obligated a better understanding and socialization of the new electronic equivalent documents, the implementation deadline is extended until November 1, 2024. The affected documents include:
- Home utilities
- Passenger transport ticket
- Excerpt
This extension allows responsible parties to have the necessary time to adapt to the regulations and facilitate compliance with related tax obligations.
c. Adding a Paragraph to Article 29
- Passenger Air Transport Tickets: The resolution adds a specific paragraph regarding the creation of equivalent electronic documents related to air travel. Since ticket reservations are made through Global Distribution Systems (GDS), which do not report in real time, the DIAN establishes a maximum deadline of 48 hours so that the electronic equivalent document of the ticket is generated and transmitted. This document must be validated by the tax administration.
- Passenger Availability: Issuers must ensure that the equivalent document is available on their electronic platforms or send it to the passenger's email address, if provided.
d. Amendment of Paragraph 3 of Article 42
- POS Equivalent Document Name Change: In this modification, the terminology for equivalent documents issued by cash registers with a POS system is updated. The new name is “Electronic equivalent document: cash register ticket with P.O.S. system”, and reflects the transition from physical documents to an electronic format.
e. Addition of a Paragraph to Article 66
- Flexibility in Electronic Invoice Graphic Representation:
- Language and Currency The resolution allows obligated parties to graphically represent the invoice in a a different currency or language to the Colombian peso and Spanish, respectively, as long as the requirement to issue the invoice in Spanish and in Colombian pesos is met. The graphical representation may include:
- Information only in another language and currency.
- Information in Spanish and Colombian pesos along with information in another language and currency.
- XML format: The XML format is the one with legal value, and the graphical representation must comply with the requirements specified for each type of document.
4. Publication Procedure
The Resolution 000119 It was published as required by Article 65 of the Administrative Procedure and Administrative Litigation Code. This step ensures transparency and access to information for the obligated parties and other interested parties, complying with the established regulations for the publication and entry into force of resolutions of this type.
5. Validity of the Resolution
The resolution took effect upon its publication in the Official Gazette, in accordance with administrative regulations. It modifies and supplements the provisions of the Resolution 000165 of November 1, 2023 and its modifications in the Resolution 000008 of 2024.
6. Conclusion
The Resolution 000119 of 2024 This represents a significant effort by the DIAN to modernize the invoicing system in Colombia, facilitating the implementation of electronic equivalent documents and adapting the system to the needs of those required to comply. The modifications introduced address specific technical and operational aspects, and provide those required to comply with greater clarity and flexibility in meeting their tax obligations.
The resolution also recognizes the importance of a gradual transition to the new electronic invoicing system, offering extended deadlines and flexibility in the graphical representation of fiscal documents. This not only improves tax compliance but also allows for better adaptation of the system to modern business practices, where international transactions require formats and representations in different languages and currencies.
Attachment: Implementation Timeline Table
| Document | Maximum Implementation Date |
| Residential Public Services | November 1, 2024 |
| Passenger Transport Ticket | November 1, 2024 |
| Excerpt | November 1, 2024 |
| Electronic Point of Sale Equivalent Document | July 1, 2024 |
Costa Rica
SUSPENSION OF VAT REGISTRATION FOR TAXPAYERS WITH TAX OMISSIONS: SAT REGULARIZATION MEASURES
Objective of Regularization
The Superintendency of Tax Administration (SAT) has identified taxpayers who have invoiced more than Q 3,200 million and are in a state of tax non-compliance. In this regard, Superintendent Marco Livio Díaz Reyes explained that the SAT will take measures, based on Article 120 of the Tax Code, to suspend the Value Added Tax (VAT) registration of those taxpayers with substantive omissions in their tax obligations.
2. Definition of Noun Omission
The omitted noun is defined as the status of a taxpayer who has not filed their VAT return or has filed it incorrectly. This non-compliance is not due to a difference of opinion in an audit, but rather to the failure to file or incorrect filing of tax obligations.
3. Analysis of Contributors at Risk of Suspension
The SAT has estimated that by September 2024, approximately 215,131 VAT Regime affiliations could be affected due to substantive omissions. These cases are distributed as follows:
- 184,226 nitsTaxpayers with no income and no return filed.
- 30,211 NITTaxpayers with income, but with a zero return.
- 694 NITTaxpayers with income who have not filed a return.
4. Billed Amount and Taxpayer Distribution
Taxpayers identified as having a substantive omission have invoiced or sold a combined total of over Q 3,258.4 million. This figure encompasses both medium and large taxpayers, as well as various regions of the country, underscoring the relevance of this measure in terms of control and oversight.
5. Main Scenarios of Omissions Identified
Different non-compliance situations requiring regularization have been observed among taxpayers. These include:
- Lack of income and declarationTaxpayers with no registered income and no tax return filed.
- Untaxed incomeTaxpayers with income who have not filed their corresponding tax return.
- Income with a zero declarationTaxpayers who, despite having income, file a zero return.
- Partial statementCases in which only a portion of income is declared.
- Billing without economic basis for purchasesTaxpayers who register purchases without adequate economic backing.
- Surplus Purchase StatementTaxpayers who declare purchases greater than those registered in the FEL system.
6. Regularization Procedure and Consequences
The Superintendent urged taxpayers to heed the call for regularization that will be made through the Virtual Agency (VA). Taxpayers will have a period of 10 business days to respond. If they fail to meet this deadline, SAT will proceed with the suspension of their VAT registration, which will prevent them from issuing invoices and other essential tax documents.
7. Impact on Competition and Tax Contribution
These actions aim to strengthen fair competition among taxpayers and ensure tax compliance. The SAT points out that the regularization and suspension process contributes to transparency and commitment to a fair and balanced fiscal system, benefiting the country as a whole.
Peru
Special Subdivision – Legislative Decree 1634
The purpose of the Special Installment Plan is to encourage the payment of tax debts administered by SUNAT that constitute income for the Treasury. This mechanism is applicable to debts due by December 31, 2023, allowing taxpayers to split the payment of these debts into various modalities.
2. Types of Debts That Can Be Included
2.1. Divisible Debts Eligible debts include:
- Income Tax
- General Sales Tax (GST)
- Selective Consumption Tax (ISC)
- Municipal Promotion Tax
- Special Mining Tax
- Tariff Duties These debts must be due as of December 31, 2023, and be pending payment on the date of application submission. They may include debts from determination resolutions, payment orders, fine resolutions, and settlements related to customs declarations, even those that are under coercive collection or appeal.
2.2. Previous Deferral or Installment Plan Balances Taxpayers with outstanding balances from previous deferrals or payment plans, both current and expired, can also participate, provided that these exclusively contain outstanding tax debts.
2.3. Fines Fines are divisible if the infraction that originated them occurred or was detected up to December 31, 2023.
3. Debt Update Procedure
3.1. Cash Payment or Summary Method The debt is updated with interest and, in certain cases, with the Consumer Price Index (CPI) up to the date of the application.
3.2. Installment Payment Option
- The debt is updated with interest and the CPI at the time of filing the application, to establish the minimum acceptance installment.
- The difference between the total debt and the down payment is updated again to the date of issuance of the installment payment approval resolution.
4. Special Fractionation Exclusions
4.1. Excluded Debts Among the debts that cannot be included are:
- Those included in insolvency proceedings under the General Law of the Insolvency System (Law No. 27809).
- Debts for retained or collected taxes and contributions to ESSALUD.
- Debts with a final court ruling and the quality of res judicata.
- Surcharges defined in article 2 of the General Customs Law.
4.2. Excluded Subjects The Special Fraction does not apply to:
- Natural persons or legal representatives with current convictions for tax or customs offenses.
- National Public Sector Entities, excluding State-owned companies.
- Subjects covered by Law No. 30737, which ensures the immediate payment of civil reparations in cases of corruption.
5. Payment and Bonus Options
5.1. Application Form The request is made through Virtual Form No. 1707 on SUNAT Online Operations, available until December 20, 2024.
5.2. Types of Modalities
- Cash PaymentIt implies full payment of the debt by applying a discount bond on the day of the request.
- Summary Payment: The taxpayer must pay at least 25% of the debt at the time of application and may divide the remainder into up to three monthly installments.
- Installment Payment: Allows you to split the payment into up to 72 monthly installments. Requires a down payment of 10% and, if applicable, the provision of collateral.
5.3. Discount Voucher The discount bond reduces interest, surcharges, and fines according to the chosen modality and the UIT debt range, without affecting the outstanding tax.
- For Cash Payment or Summary: Up to 100% in discounts for debts under 100 UIT, gradually decreasing for larger amounts.
- For Installment Payment: Up to 90% in discounts for debts under 100 UIT, with lower percentages for larger debts.
6. Special Application Conditions
6.1. Required Guarantees The Special Subdivision requires the submission of guarantees in cases where:
- The debt exceeds 200 UITs after applying the discount bond.
- There are outstanding deferred or installment payments with existing guarantees.
- The applicant is facing criminal proceedings for tax or customs offenses.
- The applicant is a business collaboration agreement with independent accounting.
6.2. Non-Payment of Installments Failure to pay installments has specific consequences depending on the type of plan:
- For Summary PaymentIt is possible to change to a payment installment plan automatically, up to 12 installments, if the taxpayer accumulates overdue installments.
- For Installment PaymentThe accumulation of two overdue installments allows SUNAT to initiate forced collection of the outstanding debt balance.
7. Procedures and Deadlines
7.1. Deadline for Resolving the Application SUNAT has 45 business days to approve or deny the Special Installment Plan application from the date of its submission.
7.2. Effects of the Custody Application Submitting the application implies the waiver of any pending challenges to the debt. If approved, SUNAT will suspend coercive collection and lift any precautionary measures taken.
7.3. Effects of Default
- The SUNAT can proceed with enforced collection if the taxpayer accumulates unpaid overdue installments.
- The discount bonus is applied proportionally in case of default, but only if the installments are paid in full.
8. Payment Options
8.1. Advance Payment of Installments Payments exceeding the monthly installment amount will be applied to subsequent installments, without altering the approved payment schedule.
8.2. Early Cancellation of Installment Plan Early full cancellation of the debt is permitted, extinguished in case of covering the monthly installment and pending installments, with the discount of the bonus.
9. Payment Allocation in Case of Rejection or Withdrawal
9.1. Rejection of Application If SUNAT denies the acceptance, payments made will be applied to debts included in the application, in accordance with the Tax Code and applicable regulations.
9.2. Withdrawal of Application When the withdrawal is approved, payments are applied in accordance with the regulations governing installments or deferrals.
Conclusion
The Special Tax Debt Installment Plan provides a system to facilitate the payment of tax obligations through installment options. Taxpayers who meet the conditions and deadlines may benefit from an interest and penalty discount bonus. The SUNAT, in its role as administrator, establishes strict guarantees and deadlines to ensure compliance with payments, reserving the right to take coercive measures in case of non-compliance. This mechanism offers a significant opportunity to regularize tax debts and alleviate the financial burden of taxpayers in Peru.
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