tractores banco puerto mvdeo

News

Figures were released for 2011’s projects approved under Uruguay’s investment promotion law, which grants tax breaks to investors of all sizes: a record 840 projects were granted tax breaks, for a total investment of USD 1.43 B. This represents a 24% increase over 2010’s 1.15 B.

Uruguay´s investment promotion law (Act 16,909) was passed in 1998, and improved in 2007. It grants tax breaks to investors on Corporate Income Tax (up to 100% of the amount invested), Value Added Tax (on goods purchased) and Asset Tax. In order to qualify and obtain the benefits, the investor must present a plan before a committee within the Finance Ministry, known as COMAP, which studies the project and evaluates its impact on the creation of new jobs, exports, technology, and even factors like the use of clean energy.

The law allows a wide array of industries to request the tax breaks, and projects approved in 2011 included companies as diverse as agricultural enterprises, call centers, professional services firms, movie centers, construction companies and logistics companies.

Uruguay’s Free Zones (Zonas Francas) reached record activity in 2011, making up 4% of the country’s GDP.

Free Zones consist of 13 different areas within the country, all of them privately run, except one. Businesses operating within Free Zones are granted total tax exemption (import duties, Income Tax, Dividend Tax, Value Added Tax, Asset Tax). The only tax that is levied is social security payment on labor.

A total of 1,628 companies of different sizes operate in Uruguay’s Free Zones, and the list includes global banks, financial services firms, auto industry companies, logistics firms, apparel companies, and manufacturers.

Three new Free Zones were opened in 2011, including one exclusively dedicated to pharmaceutical companies.

Newsletter Subscription

Download Presentations

Practice Areas