In mid-March the government led by the president, Alberto Fernández, sent a bill to Congress that lays out the details of a progressive reform to corporate income tax. The latest reform being proposed by the Fernández administration would permanently change the structure of the corporate tax code. It would do away with the flat corporate tax rate and replace it with a progressive tax schedule. This includes the replacements of the single 25% rate with the following progressive rates on net taxable income:
- up to ARS 1.3 million – 25%
- more than ARS 1.3 million up to 2.6 million – 30%
- over ARS 2.6 million – 35%
The dividend withholding tax rate would remain 7% for all firms.
Note that, a separate draft bill was being considered earlier in the year that would have extended a prior suspension of corporate tax and dividend withholding tax changes from 1 January 2021 to 1 January 2022.
