The current bulletin Tax News Compile the most relevant tax developments that occurred during March and April 2025 in various Latin American countries. In this edition, we highlight regulatory changes, circulars, and rulings issued by the tax authorities of Chile, Colombia, Costa Rica, Mexico, and Peru. Topics covered include new exceptions to the appraisal power in business reorganizations, modifications to audit deadlines, tax reductions on essential goods, adjustments to the simplified trust regime, and the scope of special installment payments. This compilation aims to provide a clear and up-to-date overview of regional tax trends to facilitate strategic decision-making and regulatory compliance for companies.

Index

• Chile
• Costa Rica
• Colombia
• Peru
• Mexico

CHILE

EXCEPTIONS TO THE POWER OF APPRAISING THE PRICE OR VALUE ASSIGNED TO A PROPERTY

CIRCULAR No. 23, dated March 27, 2025

EXCEPTIONS TO THE POWER OF APPRAISING THE PRICE OR VALUE ASSIGNED TO A PROPERTY

The new sixth subsection of Article 64 of the Tax Code establishes that the Service may assess the value of real estate and levy the corresponding tax when said value notoriously differs from the market value. The expression “market value” should be understood as “normal market value.”.

I. Exceptions to the Appraisal Power

Article 64 includes certain cases of business reorganization where the appraisal faculty does not apply, provided that specific requirements are met:

1. National and international mergers and acquisitions

According to the ninth and eleventh clauses, the appraisal does not apply if the tax cost of the assets is maintained in the absorbing or newly formed company. The legal definitions of Law No. 18,046 on corporations must be followed:

• Article 94: A spin-off involves the distribution of assets among one or more new companies, while maintaining the existing ownership structure.
• Article 99: Fusion can be:
  • By creation: a new company is formed with the assets and liabilities.
  • By incorporation: one company absorbs another.

For mergers or divisions international , the following requirements must be met:

• Comply with the legal concepts of merger or division.
• To recognize legal effects analogous to those of Chilean legislation.
• No tax effects (neither gains nor losses).
• Chilean formalities are not required if foreign legislation does not contemplate them.
• It can be proven by reports in law or other suitable means.

If the requirements are met, the appraisal is not warranted. Otherwise, the Service may exercise it. These transactions may be reviewed under the.

2. Other forms of national business reorganizations

According to paragraphs ten and eleven, the appraisal does not apply in cases such as conversion into an individual entrepreneur or asset contributions, if the following cumulative requirements are met:

1. they are carried out by natural or legal persons.
   
   
   1. Goods are allocated within Chile.
      
      
   1. There are legitimate business reasons (according to the fourteenth subsection).
      
      
   1. The tax cost of the assets is maintained.
      
      
   1. There are no effective cash flows for the contributor.

It is no longer required that:

• The contributing company shall continue to exist.
• The contributions result from a corporate reorganization.
• The capital is increased or a new company is formed.
• The value is registered by a shareholders' meeting or a public deed.

However, valuation is permitted if contributions are made at values other than the taxable value. Proof must be provided with legal evidence that the requirements of Article 64 are met to avoid valuation.

3. Other forms of international business reorganizations

The twelfth clause states that in international reorganizations other than mergers or divisions, taxation does not apply if the following cumulative requirements are met:

1. That affect assets, shares, or rights located in Chile.
   
   
2. There is a legitimate business reason.
   
   
3. No money flows to the contributor.
   
   
4. Maintain the tax cost basis of assets.
   
   
5. To comply with legal requirements of the foreign jurisdiction.
   
   
6. Chile's taxing power is not affected.

This power is affected, for example, when:

• The recipient entity is domiciled in countries referred to in Article 41 H of the LIR.
• Foreign legislation does not require accounting under general standards.

It does not matter the type of good or the characteristics of the operation. If a country with those conditions participates, the entire reorganization can be taxed.

4. Consultations on the application of Article 64

The new final paragraph allows for inquiries

• Binding.
• General in nature, non-binding.

Given that Article 64 does not distinguish between types, both are admissible.

Deadlines for the Service to carry out auditing procedures

CIRCULAR N°19.- dated March 6, 2025

9-month term

Article 59 establishes a general deadline of 9 months for audit procedures. This deadline is counted from the certification of the total delivery of background information by the taxpayer until the notification of the summons, assessment, resolution, or payment order, as applicable.

Within this period, the Tax Service may take various actions, such as issuing a summons in accordance with Article 63, processing a settlement, issuing resolutions, or issuing payment orders. It may also certify, at the taxpayer's request, that no discrepancies arise from the audit. Likewise, if the process concludes with an amended tax return, it shall certify that the audit has concluded and that no other discrepancies exist in relation to the audited operations, transactions, and events.

12-month period

The deadline for auditing

• When the audit refers to transfer pricing.
• If the net taxable income must be determined for taxpayers with sales or income exceeding 5,000 monthly tax units as of December 31 of the previous fiscal year.
• When reviewing the tax effects of business reorganization processes.
• In the review of the accounting for transactions between related companies.

18-month period

The audit period may be extended to up to 18 months in the following cases:

• Application of Articles 10, 41 F, 41 G, and 41 H of the Income Tax Act.
• Review of cases mentioned in articles 4 bis, 4 ter, 4 quáter, and 4 quinquies.
• Application of Article 63 of the Inheritance, Bequests, and Gifts Tax Act.
• Background collection processes pursuant to number 10 of article 161.
• When information is requested from a foreign authority.

These deadlines are set forth in Chapter III of Circular No. 41 of 2021, a regulation that remains in effect.

Extension of the 12 and 18-month periods by an additional 6 months

The 12- and 18-month audit periods can be extended one time for an additional period of 6 months through a motivated resolution. This must be issued by the Regional Director, the Director of Large Taxpayers, the Deputy Director of Audits, or the authority with delegated authority.

The decision must justify the extension of the deadline with factual and legal grounds. During this additional time, the Service must issue the corresponding summons, assessment, decision, or payment order, or the correction or certification, as applicable.

Extension decisions must comply with the provisions of Article 8 bis, paragraph 4, and must be notified to the taxpayer before the original deadline expires. Neither the voluntary administrative appeal under Article 123 bis nor the judicial appeal under Article 124 may be filed against such decisions.

Extension of the Deadline Due to the Detection of a Case Involving the Application of the General Anti-Avoidance Rule

When a case requiring the application of the general anti-avoidance rule is detected, the audit procedure period may be extended. Specific regulations regarding these modifications will be addressed in the corresponding circular that instructs on the application of said rule.

Bill No. 323-372/

Temporary reduction of the Income Tax rate for Pro Pyme companies

The rate established in Article 20 of Section 1 of the Income Tax Law, contained in Decree-Law No. 824 of 1974, will be temporarily reduced for companies participating in the Pro-SME Regime. This reduction establishes a new rate of 12.5% applicable to income received or accrued during the 2025, 2026, and 2027 fiscal years.

Conditions for Applying the Reduced Rate

For the rate reduction to take effect, the contribution rate established in the fourth transitional article of the law creating the new mixed pension system must meet certain thresholds at the end of each fiscal year. These thresholds are as follows:

• 1% for fiscal year 2025.
• 3.5% for fiscal year 2026.
• 4,251 TP3T for fiscal year 2027.

Reduction in the Monthly Interim Payment Rate

Taxpayers benefiting from the temporary reduction in the income tax rate will also see their monthly estimated tax payments cut in half. This will apply in accordance with the provisions of Article 14(D) of the Income Tax Law and will be in effect for the 2025, 2026, and 2027 tax years.

Effective Date of the Reduction in Interim Payments

The reduction in the monthly estimated tax rate will take effect for the return and payment due in the month following the publication of this law in the Official Gazette.

Applicable rate for fiscal year 2028

Starting in fiscal year 2028, the income tax rate for companies participating in the Pro Pyme Regime will be 15%, provided that the contribution rate mentioned in the first paragraph reaches 5% at the end of that fiscal year.

Costa Rica

Tax cuts for essential goods

CP–18–2025 Wednesday, March 19, 2025

The sound performance of public finances has led to favorable results, such as a reduction in public debt to less than 60% of GDP and the achievement of consecutive primary surpluses. In this context, for the first time in the history of Costa Rica’s tax system, the decision has been made to reduce taxes on 60 essential goods. This measure aims to improve the progressivity of the tax system and benefit the majority of the population.

Amendment to Law No. 4961 by Executive Decree 44921-MH

The entry into force of Executive Decree 44921-MH introduces changes to Law No. 4961, which regulates tax reform and the consolidation of selective consumption taxes. The amendment involves a gradual reduction in the selective consumption tax rate for these products, whose tax burden had ranged from 5% to 30% for the past four decades, when they were considered luxury goods. The new provision will be published shortly in the Official Gazette. The Gazette.

Products benefiting from tax reduction

Among the products that will benefit from this reform are cleaning and personal hygiene items, such as detergents, soaps, liquid bleach, fabric softeners, shampoo, hairspray, body deodorants, and shaving products. Also included are industrial and commercial products, such as paints, varnishes, acrylics, batteries, and electrical ignition devices for engines. The tax reduction on these goods is intended to promote commercial activity, spur economic recovery, and benefit the end consumer.

Impact on Progressivity and the Fight Against Tax Evasion

According to Finance Minister Nogui Acosta, reducing and simplifying tax rates will improve the progressivity of the tax system and close loopholes for tax evasion. The unification of tax rates will prevent certain goods from being declared at rates lower than those to which they are actually subject, which will help boost tax revenue.

Offsetting the Decline in Tax Revenue

The standardization of tax rates will help offset the reduction in government revenue, which is estimated at 4,416 million colones by 2025. Furthermore, since these are mass-market products, the tax cut is expected to generate an increase in demand, which could partially mitigate the fiscal impact of the reform.

Dates and Application Rates for the Tax Reduction

The process of reducing the selective consumption tax will be implemented gradually on the following dates:

• March 31, 2025: 17 products will undergo a gradual, annual reduction until they reach a rate of 10%.
• June 30, 2025: 27 products will be subject to a 0% rate.
• September 30, 2025: 16 products will begin a gradual, annual transition until they reach a rate of 15%.

This reform represents a significant step towards a more equitable and efficient tax system, benefiting lower-income sectors and promoting transparency in tax collection.

COLOMBIA

The ineffectiveness of tax returns

Concept 100202208 – 0225 of February 13, 2025,

1. Introduction

Article 55 of Decree 1742 of 2020 empowers the Directorate of Legal Management (DGJ) to respond to inquiries from the Directorate of Auditing Management (DGF) regarding the validity of tax returns. In this context, two key questions arise:

1.1. Is it necessary to issue an administrative act to invalidate a declaration that has no legal effect and to reflect this change in DIAN's systems?

1.2. Which subprocess must rule and what is the appropriate procedure for an independent request to amend a declaration?

To respond, six assumptions of tax ineffectiveness are analyzed, addressing their legal basis and applicable procedures.

2. Types of Ineffectiveness in Tax Filings

2.1. Declarations deemed not filed: Although failure to meet formal requirements renders them invalid, their invalidity does not take effect automatically. An administrative act is required to formalize their status and reflect it in the tax administration’s systems, thereby ensuring legal certainty for taxpayers.

2.2. Statements with no legal effectIn these cases, the nullity is automatic by operation of law, without the need for an administrative act for its confirmation. However, it is essential that the tax administration maintains adequate control and record-keeping of these situations to avoid inconsistencies in tax accounting.

3. Key Differences

• Declarations deemed not filedThey require the intervention of the tax administration through an administrative act, as their ineffectiveness does not occur automatically.
• Statements with no legal effectThey are ineffective by legal provision and do not require an additional procedure for their invalidation, except in specific cases where the administration must verify their application.

It is important to highlight that tax ineffectiveness, by having sanctioning implications, must be expressly regulated by law, avoiding its application by analogy or extensive interpretation. Otherwise, the principle of legality could be violated and legal uncertainty generated for taxpayers.

4. Ineffective Disclosures Under the Law

4.1. VAT for Nonresident Taxpayers Who Have Not Paid in Full (Art. 437 E.T.): Filing the return without full payment of the tax results in its automatic invalidity, preventing any legal effect on the declared tax.

4.2. Withholding tax without full payment (Art. 580-1 E.T.): In this case, the ineffectiveness also operates automatically, without the need for an additional pronouncement from the administration. However, the tax administration must ensure that this ineffectiveness does not hinder the auditing and collection procedures.

Despite their ineffectiveness, these statements can be used as executive titles in coercive collection proceedings, which implies that the DIAN retains the power to demand payment. This aspect highlights the importance of efficient tax information management to avoid potential legal conflicts between the administration and taxpayers.

5. Jurisprudential Considerations

Official Letter No. 911122 of 2022 reaffirms that ineffective declarations take effect without the need for an administrative act. In turn, the Council of State has held that invalidity may arise directly from the law, without requiring an express declaration in each specific case, provided that there is a clear and precise legal provision supporting it.

6. Other Grounds for Ineffectiveness

6.1. Late corrections: The law establishes specific deadlines for correcting tax returns (Art. 588 and 589 of the Tax Code), and failure to comply with these deadlines renders the correction ineffective, thereby affecting the taxpayer’s ability to voluntarily correct errors.

6.2. Corrections without legal requirements: If an amended tax return does not meet the formal and substantive requirements established by law, it is considered invalid. This underscores the importance of taxpayers understanding and complying with the established procedures.

6.3. Statements filed after an official tax assessmentOnce the tax administration has officially determined the tax through an assessment, any subsequent declaration filed by the taxpayer has no legal effect. In these cases, the administration must ensure the correct application of the principle of tax finality.

7. Answers to the Questions Asked

7.1. Regarding the issuance of an administrative act (Question 1.1.):

• Tax inefficiency must be expressly provided for by law to avoid subjective interpretations.
• If ineffectiveness operates by legal mandate, an additional administrative act is not necessary, except in situations where a formalization is required for accounting purposes.
• It is not appropriate to apply ineffectiveness analogously to cases not expressly regulated by current regulations, as this could affect taxpayers' right to defense.

7.2. Competent subdivision and form of pronouncement (Question 1.2.):

• Art. 580-1 Tax Code.The Directorate General of Taxes (DGI) verifies payment and, in case of non-compliance, proceeds with collection without needing to remove the declaration from the system. This allows for efficient revenue management without affecting the validity of the registered information.
• Art. 437 E.T.The DGI reviews payment compliance and adjusts the taxpayer's current account in case of ineffectiveness, ensuring accounting consistency.
• Article 594-2 ET.The DGF determines whether there was an obligation to file a declaration and, if not, coordinates the cleanup with the DGI to avoid incorrect records.

When ineffectiveness requires an administrative act:

• The DGF issues it ex officio or at the taxpayer's request, guaranteeing the right to contradiction and defense.
• You must comply with the notification procedure and the corresponding administrative remedies (Art. 720 E.T. and Law 1437 of 2011), which ensures due process.
• Once final, the DGF communicates with the DGI to modify the taxpayer's current account and reflect the effect of the ineffectiveness in the DIAN's systems, avoiding inconsistencies in fiscal records.

Peru

Waiver and acceptance of the Special Installment Plan (FE) in tax proceedings

REPORT NO. 000028-2025-SUNAT/7T0000, dated 03/22/2025

1. Scope of Tax Debt Assumption by the FE

Article 4 of the Decree states that tax debts administered by SUNAT that constitute income of the Public Treasury, such as income tax, general sales tax, selective consumption tax, municipal promotion tax, special mining tax, customs duties, among others, may be eligible for the FE. Said debts must be enforceable as of December 31, 2023, and be contained in determination resolutions, payment orders, fine resolutions, collection settlements, customs declaration settlements, or other resolutions.

Enrollment in the FE also includes outstanding balances from deferrals and/or payment plans, whether currently active or subject to loss, pending payment as of the enrollment request date, as well as disputed debts or those in coercive collection.

According to paragraphs 7.2 and 7.3 of Article 7 of the Regulations, each deferral request must detail the corresponding tax debt. Furthermore, the deferral must be made for the total amount of debt contained in the respective resolutions, updated according to Article 6 of the Regulations.

2. Concept of Disputed Debt and its Adoption by the FE

Subsection c) of paragraph 3.1 of Article 3 of the Decree defines disputed debt as debt for which a claim, appeal, administrative litigation lawsuit, or amparo action has been filed before the application for admission to the FE. Debt that has been paid for its dispute is not considered disputed.

Article 10 of the Decree establishes that applying for the FE also implies an application to withdraw the claim regarding the disputed debt. Said withdrawal is considered valid when the application is approved. In these cases, the competent body must conclude the corresponding claim, appeal, or judicial proceeding.

This implies that only those debts that are not disputed by the taxpayer can be included in the FE, and therefore, the certainty of their collection is established. Furthermore, in cases where the disputed debt includes amounts eligible and ineligible for the FE, the conclusion of the process will be partial, affecting only the amounts eligible for the FE.

3. Application of Withdrawal in Specific Cases

The application of the regulated withdrawal in Article 10 of the Decree is analyzed based on different scenarios:

• First consultationIf a procedure includes several disputed values and the taxpayer opts to accept only one, the withdrawal only affects the accepted value, with the others remaining disputed.
• Second queryThe Decree regulates the withdrawal of appeals filed by tax debtors concerning debts included in the FE. However, it does not include challenges made by the tax administration, which will continue their processing.
• Fourth queryArticle 3 of the Decree states that a disputed debt is one for which an administrative litigation lawsuit or an injunction has been filed before the application for admission. Therefore, withdrawal will only proceed on those lawsuits that affect the determination and/or collection of the debt admitted to the FE, guaranteeing certainty in its collection.

4. Exclusion of Debts with Final Judicial Resolution or Guarantee Letter

According to subsection c) of Article 5 of the Decree, the FE does not include debts that, at the time the Decree enters into force, have a firm judicial resolution, are consented to, or have the quality of res judicata, and have a surety bond according to Article 159 of the Tax Code.

The explanatory memorandum of the Decree justifies this exclusion by stating that these debts have already been challenged in various instances and have resulted in the deployment of state resources. Since there is certainty regarding the amount owed to the treasury and it is backed by a performance bond, it is not justifiable to postpone its collection.

However, if a debt has a final court ruling but the surety bond does not cover the full amount owed, the unsecured balance could qualify for the FE. In this case, the taxpayer could request that the uncovered balance be included, as it would not fall within the scope of the exclusion provided for in Article 5 of the Decree.

CONCLUSIONS:

1. If, in a procedure where several values have been challenged, the taxpayer opts to accept the FE for only one of them, it is understood that the withdrawal is solely with respect to the value for which the application to accept the FE was submitted, with the other values remaining challenged.
   1. The withdrawal of debt disputed by tax debtors, provided for in Article 10 of Legislative Decree No. 1634, regarding debts for which they request admission to the FE, does not include disputes of such debts that the tax administration may have made, so these continue their processing.
   1. If a taxpayer has judicially challenged a tax debt and the Judiciary has issued a final judgment before the effective date of the Decree, by executing the surety bond granted under Article 159 of the Tax Code, the balance not covered by it may be eligible for the FE. 4. The withdrawal generated by the approval of the FE application only applies to contentious-administrative lawsuits and amparo actions filed by the tax debtors, whose claim has an impact on the determination and/or collection of the debt for which the FE had been requested, whether directly or indirectly.

Mexico

Simplified Trust Regime Facilities (RESICO)

The Tax Administration Service (SAT) offers various facilities to individuals who wish to pay taxes under the Simplified Trust Regime (RESICO). Among these facilities is the elimination of the obligation to file an annual declaration for the corresponding income, allowing taxpayers to only make monthly payments.

Reincorporation option to RESICO

different regime As part of the tax simplification scheme, it is established that individuals who were changed by the tax authority to a different regime and whose income in the immediately preceding year did not exceed 3.5 million pesos, may opt to rejoin RESICO starting January 1, 2025. To do so, they must submit a Economic Activity Update Notice. before January 31before January 31, 2025.

Incorporation of productive sectors into RESICO

The SAT is expanding the benefits of this regime to include individuals engaged in activities in the agriculture, livestock, fishing, and forestry sectors. Partners or shareholders of credit unions can also pay taxes under this regime, which facilitates their tax compliance.

Who can pay taxes under RESICO?

This system is aimed at individuals whose annual income does not exceed 3.5 million pesos and who carry out activities in the following sectors:

• Primary sector (agriculture, livestock, fishing, and forestry).
• Business activities in general.
• Professional service provision .
• Real estate lease , meaning those who earn income from the use or enjoyment of properties.

Benefits of RESICO

The RESICO aims to facilitate the payment of Income Tax (ISR) through various administrative and fiscal benefits, such as:

• Automatic tax calculation , simplifying the determination of tax obligations.
• Administrative facilities , reducing the bureaucratic burden for taxpayers.
• Minimum ISR Rates , allowing for more accessible tax payment.

This regime aims to promote formalization and facilitate tax compliance for taxpayers through clear rules and simplified processes.

SOURCE: https://www.gob.mx/sat/prensa/sat-brinda-facilidades-para-tributar-en-el-resico-04-2025?idiom=es