Global Tax Alert (News from Americas Tax Center) | 10 December 2013

Argentina imposes 35% tax surcharge on acquisition of foreign currency for travel and tourism

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The Argentine Federal Tax Authorities (AFIP) have issued General Resolution No. 3550/2013 (published in the Official Gazette on 3 December 2013), which expands the scope of the reverse withholding (or “percepción” in Spanish) surcharge applicable to certain purchases of goods and services outside of Argentina to include the purchase of foreign currency for travel and tourism purposes. The General Resolution also increases the surcharge rate from 20% to 35%. The provisions contained in the General Resolution became effective on 3 December 2013.

In addition, the surcharge applies to: (a) purchases made by Argentine residents, using credit or debit cards issued in Argentina, of goods or services outside of the country; (b) purchases made in foreign currency through websites or internet connections; (c) purchases of services abroad hired through Argentine travel agencies; and (d) purchases of passenger transportation services to foreign destinations by land, air, and water.

The foreign exchange context in Argentina has to be taken into consideration to understand the issuance of General Resolution 3550 by the tax authorities. Foreign exchange regulations mainly issued and governed by the Argentine Central Bank have introduced requirements and restrictions on the ability to purchase and/or transfer abroad foreign currency through the official exchange market. Now the introduction of the 35% tax surcharge on the authorized purchases of foreign currency for travel and tourism purposes (which will be collected by the official institution involved in the foreign exchange transaction) is intended to enforce additional controls on the acquisition of foreign currency through the official exchange market.

In this regard, the surcharge will be considered, depending on the tax status of the Argentine resident, as a payment on account of income tax and personal assets tax. The actual ability of the taxpayers to compute the surcharge as a payment on account of their income tax or personal assets tax liabilities will determine whether this 35% tax ends up being an increase in their overall tax burden or not.

For additional information with respect to this Alert, please contact the following:

Pistrelli, Henry Martin & Asociados S.R.L., Buenos Aires
  • Carlos Casanovas
    +54 11 4318 1737
  • Gustavo Scravaglieri
    +54 11 4510 2224
  • Ariel Becher
    +54 11 4318 1686
  • Pablo Baroffio
    +54 11 4510 2271
Ernst & Young LLP, Latin American Business Center, New York
  • Alfredo Alvarez
    +1 212 773 5936
  • Pablo Wejcman
    +1 212 773 5129

EYG no. CM4030