The Executive Branch has just published a new decree that modifies the previous investment promotion regime, giving opportunities to new projects and improving benefits through new weightings of factors and indicators that are taken into account to achieve them.
We can summarize the following concepts.
• All IRAE taxpayers can access benefits.
• The investments to be included, in general terms, are all those investments in real estate and / or personal property with an individual value greater than UI 500 (approximately $ UY 2,400), with the exception of goods destined for homes and non-utility vehicles. The Executive Branch could include investments made in intangible assets.
• For investments already made, all those within a period ranging from the beginning of the project presentation year or from 6 months prior to presentation can be included and up to a maximum term of 10 years. In this sense, the Executive Branch eliminates the limits for investments made before the presentation of the project.
• The indicators to which the company must commit itself continue to be: Job creation, Decentralization, Clean Technologies, Innovation, Increase in exports and another sector of choice depending on the Ministry that will evaluate the project.
• The aforementioned commitment must be assumed for 3 years (in the previous regime it was 5 years)
• For the employment indicator, the annual average of jobs to be created will be taken into account and a score will be awarded based on the investment amount of the project. In turn, there is a transitory benefit for projects submitted until December 31, 2020, granting 1 additional point to the employment generation indicator, with 10 points being the maximum for the indicator.
• In decentralization, a score is added to the investments made in Montevideo (non-existent in the previous regime)
• IRAE exemptions. A minimum exemption of 30% and up to 100% of the invested amount may be obtained. The benefit can be used from 4 to 25 years. The exemption ceiling to be used in each year is increased to 90% of the IRAE.
• Other tax benefits. The benefits are maintained for the Wealth Tax, exemption from civil works of 8 or 10 years and for movable assets for their useful life. Regarding VAT, the refund will be made by obtaining credit certificates. Regarding the goods to be imported, the tax exemption is maintained as long as they are not competitive with the national industry.
Companies that present their projects until March 31, 2021, will have the possibility of increasing the exemption percentage by 20% for those investments made until December 31, 2021 and that are at least 75% of the total investment engaged.
Investments made during 2020 and until March 31, 2021 will be calculated at 150% of their value.
For this reason, the importance that if your company is about to make investments, take into account the possibility of presenting your project to COMAP in order to obtain these benefits.
Our Consulting Area - Formulation and Presentation of Investment Projects before COMAP are at your service for any questions in this regard.
Contacts Cr. Federico Pérez - firstname.lastname@example.org
Cr. Andres Santamaría - email@example.com