On 27 December 2017, the Argentine Congress passed comprehensive tax reform, which became effective as of 1 January 2018.
It contains a number of important changes related to transfer pricing, including:
- Introduction of new requirements related to transactions of import and export of goods carried out through international intermediaries (intermediary substance test).
- Introduction of substantial changes for the valuation of the exports of commodities carried out through a foreign intermediary, and alignment of the documentation requirements of such transactions with the OECD standards recently developed under Action 10 of the BEPS initiative.
- Introduction of a detailed definition of Permanent Establishment (PE), broader than the definition by the OECD Model Tax Convention Guidelines, and introduction of rules aiming to capture profits generated by the PE.
- Introduction of a Regime named "Determinaciones Conjuntas de Precios de Operaciones Internacionales" (similar to an Advance Pricing Arrangement [APA] programme) and regulations that are expected to make the Mutual Agreement Procedures (MAPs) effective.
- Tax havens - due to the modifications introduced in the legislation, transfer pricing rules also apply to transactions carried out with third parties located in (1) jurisdictions considered non-cooperative for tax purposes, ad / or (2) jurisdictions of low or nil taxation.
- Introduction of materiality thresholds for transfer pricing documentation purposes.
- Update of the amounts of the penalties for not complying with Country-by-Country (CbC) Reporting obligations, including CbC Reporting notifications.
- Restriction on interest deductions broader than those of Action 4 of the BEPS initiative