New Bill on Installment Agreement within the City of Buenos Aires

Law No. 3,461 (the “Law”) of the City of Buenos Aires (the “City”), published on July 1, 2010 in the Official Gazette of the City, establishes a special regime to regularize tax obligations in arrears (the “Regime”).

Decree No. 533/2010 of the Executive Power of the City and Resolution No. 393/2010 of the City Tax Authority (“AGIP” for its Spanish acronym) regulate and establish the conditions to enter the Regime.

The Regime allows for the regularization of past due obligations, overdue until December 31, 2009 and applies to the Gross Income Tax, the Stamp Tax and other local contributions.

 

The regime allows for the inclusion not only of debts being administratively or judicially contested but debts spontaneously declared by the taxpayer or acknowledged by the taxpayer during the administrative audit.  

The Law excludes tax withholding and collecting agents who failed to deposit the withheld or collected taxes, taxpayers in bankruptcy and those who have regularized their situation through payment plans currently in force that have remitted interest, among others.

The benefits resulting from the adherence to the Regime are: a) remission of fines, with exemption to those legally settled, b) substantial reduction of interest, c) possibility of entering payment plans, by making an initial payment and up to 60 monthly installments, with an annual rate ranging from 9 to 18% depending on the payment term.

The adherence to this Regime leads to waive the right to recover regularized tax, its interest and fines, and entails the acknowledgement of the declared debt.

 

It should be emphasized that upon the expiration of the plan, the Regime establishes 60 consecutive days of default for the cancellation of any of the installments. If the plan expires, the original interest shall be applicable together with the corresponding sanctions.