The benefits govern the border towns with Brazil
On December 1, the measures contained in the Border Law began to take effect, to improve competitiveness, work and quality of life in areas bordering Brazil. Elimination of the minimum VAT, reduction of the basic rate and employer contributions, and a simplified import regime are some of the initiatives.
Among the defined measures are the elimination of the minimum value added tax (VAT) and the reduction of 50% of the basic rate, that is, 11% discount. In addition, the 75% reduction in employer contributions for new workers in companies located up to 60 kilometers from a border crossing with Brazil.
Finally, a simplified import regime is included for a specific list of products in the basic basket.
Regarding the refund of the entire minimum VAT and 50% reduction of the basic rate (11%), the measure includes purchases in general retail stores located less than 20 kilometers from a border crossing. Transactions must be carried out with debit cards or electronic money instruments.
The Simplified Import Regime provides for total exemption from import taxes for certain products in general retail stores located a maximum of 60 kilometers from the border. There will be quantitative limitations on imports of merchandise by companies.
For example, for those who receive annual income of up to 305,000 indexed units (UI), the monthly import limit will be 10,000 UI. In addition, they must meet an annual limit of 100,000 IU. On the other hand, companies whose annual income does not exceed 1.5 million UI will not be able to import more than 36,000 UI monthly, with a maximum of 360,000 annually. Finally, companies that invoice up to 3.5 million UI will be able to obtain merchandise for up to 60,000 UI per month and 600,000 UI annually.
The list of authorized products will be published by the Ministry of Economy and Finance (MEF) and contains the following products:
▪ Beans
▪ Lentils
▪ Cocoa powder
▪ Dried noodles and pasta
▪ Sweet cookies
▪ Cookies and crackers
▪ Yerba mate
▪ Toothpaste
▪ Deodorants and antiperspirants
▪ Shampoo
▪ Toilet soap
The reduction of up to 75% in employer contributions for new workers hired in the next 12 months by companies located a maximum of 60 kilometers from a border crossing will be applicable to the manufacturing industry, retail trade, accommodation and food services, administrative and support activities, arts and entertainment and other service activities.
To these measures included in the decree are added those that are already applied, such as the discount on specific internal tax (IMESI) on gasoline in towns located 20 kilometers from border crossings.
In addition, the Government is working on drafting a law to expand the range of discounts. As announced by the Undersecretary of Economy, Martín Vallcorba, the new regulations will cover localities located within a radius of between 20 and 60 kilometers, with a 50% discount to the one currently applied.
For more information, the website of the Ministry of Economy and Finance and inquiries via email are available. [email protected]. Source Presidency.
