Regulation on fiscal benefits for several infrastructure works

Law N° 26,360 (03/08/2008) established a temporary regime for the fiscal treatment of new capital goods investments -except for automobiles- which entitle the category of amortizable personal property in Income Tax Law, destined for industrial activity and for certain infrastructure works, taken place between October 1, 2007 and September 30, 2010.

The fiscal benefits of said regime are the following:

(i) a Value Added Tax refund regarding the goods or the infrastructure works included in the investment project proposed, or

(ii) the accelerated amortization of the goods or the infrastructure works in the Income Tax. It is not possible to access both fiscal benefits with the same project. It is worth noting that the benefits of an accelerated amortization and of an anticipated refund of Value Added Tax will not exclude one each other in the case of investment projects whose production is exclusively to export and/or are contained in a plan of clean production or of sustainable industrial reconversion, approved by the Secretary of Environment and Sustainable Development of the Chief of the Cabinet of Ministers.

Decree N° 726/2009 (06/16/2009) regulated Law N° 26,360 and established that in order to access the benefits of Law N° 26,360 'industrial activities' are considered to be those classified as Manufacturing Industry with tabulation category "D" of the NATIONAL CLASSIFIER OF ECONOMIC ACTIVITIES ("CLANAE"). The 'manufacture' of metallic and non metallic mineral products is included in said classification.

On 09/21/2009 the "Ministry of Federal Planning, Public Investment and Services", the "Ministry of the Economy and Public Finance" and the "Ministry of Production" enacted Joint Resolution N° 1772/2009, 195/2009 and 375/2009 ("Joint Resolution"), which approved the "Regulation for the Promotion of Investment Projects of Infrastructure Works" and the "Regulation of the Investments Promotion Regime in New Capital Goods". Said Resolution includes "mining exploration and development" among "the projects enabled to request the access to the benefit of an anticipated refund of the Value Added Tax and/or an accelerated amortization of the Income Tax", as long as said "realization is declared as a 'critical infrastructure work' by the 'Ministry of Federal Planning, Public Investment and Services'."

The Joint Resolution details the process to:

(i) obtain the declaration of an "infrastructure critical work" and, as such, the requirements due in the petition and the analysis that must be made by the "Ministry of Federal Planning, Public Investment and Services" to declare an investment project as an "infrastructure critical work"; and to

(ii) obtain the benefit of an anticipated refund of the Value Added Tax and/or an accelerated amortization of the Income Tax.