Government has released a draft decree No.1112/2017 for tax reform Law 27430 on December 29, 2017, but it has not officially published yet. This decree includes transfer pricing aspects, permanent establishment (PE) rules, restriction on interest deduction, controlled foreign company (CFC) rules.
Transfer pricing aspects
The draft decree contains supplementary regulations regarding the functional analysis required for foreign intermediaries that participate in the import and export of goods into and from Argentina respectively, instructions for transfer pricing methods application, and documentation requirements, including the local file, master file and country-by-country (CbC) report. According to this decree, transactions with parties in low-tax jurisdictions are also subject to transfer pricing scrutiny.
Permanent establishment (PE) rules
This decree describes profit attribution, fixed place of business, and dependent agent, among others.
Restriction on interest deduction
Under this proposed decree, 30% of the earnings before interest, taxes, depreciation and amortization (EBITDA) limit may not be applicable to interest subject to withholding tax.
CFC rules
It includes substance guidelines about CFC rules.
