New Collection Regime Following Termination of PAIS Tax

Through General Resolution 5617/2024, published in the Official Gazette on December 19, 2024, the Argentine Tax Authority (ARCA) introduced a new collection regime for advance payments of Income Tax and Personal Assets Tax upon executing certain foreign exchange transactions. This new collection regime replaces the previous one, linked to the PAIS tax (regulated under General Resolution 4815).

 

The most important aspects of the   new regime are:

 

FX Transactions subject to the collection regime

 

• Foreign exchange transactions for saving purposes or without specific application linked to the payment of obligations under the regulations in force in the foreign exchange market, or for paying imports of certain luxury goods in Annex I of the Resolution.

 

• Foreign exchange transactions carried out by financial institutions on behalf of the acquirer, for paying goods and/or services rendered abroad, paid with credit or debit cards, or through any other means. This includes online purchases and any other form of distance shopping in foreign currency.

 

• Foreign exchange transactions carried out by financial institutions on behalf of the acquirer for paying services rendered by nonArgentinian residents, paid with credit or debit cards, or through any other means.

 

• Acquiring services abroad through travel and tourism agencies in Argentina.

 

• Acquiring land, air, or water passenger transportation services for traveling abroad.

 

Excluded transactions

 

• Purchase of medications.

 

• Purchase of books in any format.

 

• Use of educational platforms and software for educational purposes.

 

• Purchase of land passenger transport services to neighboring countries.

 

• Expenses related to research projects carried out by researchers in the scope of the State (national, provincial, municipal) and universities/institutions of the Argentinean university system.

 

• Acquisition abroad of materials and equipment for firefighting and civil protection by entities recognized in Law 25054 (and its modifications).

 

Taxpayers subject to the collection regime

 

Individuals or legal entities, undivided estates, and other taxpayers residents of Argentina are subject to this regime.

 

Collection agents

 

The following must act as collection agents:

 

• entities authorized by the Argentine Central Bank to operate in foreign exchange,

 

• entities that collect payments from users of credit, debit, and purchase card systems,

 

• travel and tourism agencies that collect payments for services,

 

• land, air, or water transport companies.

 

Payment aggregators must collect the tax if they intervene.

 

Tax rate and advance payment calculation

 

The advance payment must be calculated by applying a 30% tax rate on the total amount of each transaction covered. If the transaction is in foreign currency, it must first be converted into its equivalent in ARS, applying the Banco de la Nacion Argentina selling exchange rate.

 

Advance payment treatment

 

The amounts collected will be considered advance payments of these taxes:

 

• Income Tax,

 

• Personal Assets Tax for taxpayers registered in the Simplified Tax Regime for Small Taxpayers  (Monotributo) or others who are not subject to Income Tax.

 

The amounts collected under this Collection Regime will be computed in the annual Income Tax or in the Personal Assets Tax return of the fiscal period in which the collection took place. When the amounts collected result in a balance in favor of the taxpayer, such positive balance may be used for paying other tax liabilities or reimbursed in cash.

 

Those not subject to the taxes above but who are taxed under this regime can request ARCA to reimburse the amount in cash.

 

Finally, the Resolution establishes what amount and when it must be collected, the refund mechanism for taxpayers not subject to Income Tax or, if applicable, to Personal Income Tax, as well as the formalities for paying the collection.

 

Entry into force

 

This Collection Regime entered into force on December 19, 2024, after the repeal of General Resolution (AFIP) 4815, which regulated the former collection regime related to the PAIS Tax.