The “Knowledge Economy Promotional Regime” (the Regime) was created through Law 27.056 and will apply throughout the country. It aims to promote economic activities related to the use of knowledge and the digitalisation of information supported by progress in science and technology. The Regime has been enacted through Decree 708/2019 (Official Gazette 10/16/2019), and Resolution (SEyPyME) 449/2019 (Official Gazette 10/18/2019).
The Regime will become effective from 1 January 2020 and will be valid until 31 December 2029.
Legal entities may enjoy the benefits of this promotion regime by registering in the Registry created for such purposes, provided their total billing during the previous six months includes at least 70% in respect of activities specifically detailed in the standard.
In addition, they must prove that they can comply with at least two of the three following requirements provided for in the law:
a. A reduced general corporate tax rate of 15%, to the extent that companies which benefit maintain the number of employees on their payroll;
b. Deduction of tax credits derived from any payment or withholding of foreign taxes, even when the taxed income is of Argentine source.
The promotion regime is very interesting, because in addition to the benefits described above, the effective tax rate is very competitive (also at an international level). This evidences Argentina’s intention to promote these types of economic activity, regardless of who is managing the Government’s administration.