On 28 June 2024, Argentina’s Congress approved Law N° 27.743/20241, that introduces new modifications to the country’s wealth tax. It creates a new “Special Regime for Advance Payment of Wealth Tax” (“Régimen especial de Ingreso del Impuesto sobre los Bienes Personales” or “REIBP”) which allows taxpayers who are tax resident – and certain nonresidents – to make one advance payment and avoid future tax return filings and tax payments (until fiscal period 2027). The original deadline for this option is 31 July 2024; however, the regulatory decree could modify this deadline.
Why this matters
Changes introduced by the Law affect many tax-resident taxpayers who are subject to wealth tax, in general for those employees who started an international assignment during 2023 (and maintain the fiscal residency in Argentina for the rule of 12 months) and the tax treaty is not available between Argentina and the host country.
Many individuals subject to wealth tax in Argentina on their worldwide assets may welcome this development. This development positively impacts those taxpayers with an obligation to pay wealth tax for fiscal year 2023 as a rate reduction could apply as long as they meet the conditions for being a compliant taxpayer. The changes also reduce their form completion and filing requirements, thus lessening the administrative aspects around wealth tax compliance.
More Details
According to Article 50 of the Law, the taxable base for using this option will be calculated by valuing all assets as of 31 December 2023, except for certain assets indicated to be valued as of 10 December, and deducting exempt assets established by the wealth tax law. This taxable base will then be multiplied by five. Tax will be calculated applying a rate of 0.45 percent to the taxable base.
This Law also establishes fiscal stability up through 2038 regarding assets. Essentially, taxpayers who choose to adhere to the REIBP (contribuyentes que optan por adherir al REIBP) will benefit from fiscal stability until the year 2038 concerning the wealth tax and any other national taxes (regardless of its type) that currently exist or could be created. Their tax burden on asset taxes cannot be increased, and the rate cannot exceed 0.75 percent until 2027 or 0.45 percent for the following 10 years.
Furthermore, Article 65 proposes a benefit for compliant taxpayers, meaning those who have fulfilled all their obligations regarding the wealth tax for the fiscal periods 2020 to 2022 may claim a 0.5-percent reduction in the tax rate for the periods 2023, 2024, and 2025.
Taxpayers considered tax residents as of 31 December of each year are allowed to deduct a new minimum nontaxable amount for fiscal year 2023: ARS 100,000,000.
Wealth Tax Rates for Assets in Argentina and Abroad
For fiscal year 2023:
| FY 2023 Asset Range (ARS) – For assets valued higher than minimum nontaxable | |
|---|---|
From-To | Tax Rate |
0 - 13,688,704.14 | 0.50% |
13,688,704.14 - 29,658,858.98 | 0.75% |
29,658,858.98 - 82,132,224.86 | 1.00% |
82,132,224.86 - 456,290,138.07 | 1.25% |
456,290,138.07 – and over | 1.50% |
Source: KPMG in Argentina
(For related coverage, see GMS Flash Alert 2024-098, 24 April 2024.)
KPMG Insights
Companies with globally-mobile employees, especially Argentinean citizens working globally, should consult with their tax service professionals, or a member of the tax team with KPMG in Argentina (see the Contacts section), about the new wealth tax changes and how their personal tax return obligations could be affected.
For related coverage of changes to the wealth tax regime provided for in the recent tax reform package, see GMS Flash Alert 2024-147, 15 July 2024.
Contacts
Footnotes
1 Ley de Medidas Fiscales Paliativas y Relevantes published in the online Boletín Oficial de la República Argentina: Ley 27743 / Law No. 27,743.
See a report/analysis (in Spanish) of the law while still in bill form from the Oficina de Presupesto del Congreso.
Disclaimer
The information contained in this newsletter was submitted by the KPMG International member firm in Argentina.
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