latin america in focus newsletter

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Latin America in Focus

Staying ahead of cross-border operations

Latin America's emergence as a world market has been, and continues to be, accompanied by an upsurge in the complexity of laws, regulations, and practices impacting cross-border operations throughout the region.

Latin America in Focus shares the latest developments with consequences for the region's tax, legal, and overall business environment—developments that businesses and individuals with investments in Latin America cannot afford to ignore.

Click on any of the headings below to read more about the topic.

In this issue

Brazil

New federal law aims to end “tax wars”

The Brazilian government enacted a law on 7 August 2017 that aims to put an end to the “tax wars” that have plagued the country for the past several decades as a result of unilateral ICMS benefits granted by the states.

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Guidance on CbC reporting rules amended

The tax authorities issued guidance on 26 July 2017 that could require companies that designated a foreign ultimate parent entity as the CbC reporting entity for fiscal year 2016 to file a CbC report within 60 days of 31 December 2017.

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City of São Paulo to levy service tax on off-the-shelf software

The tax authorities of the city of São Paulo published a binding interpretative opinion on 19 July 2017 that clarifies the levy of municipal services tax on software licenses and assignments of software rights.

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Court rules payment for procurement services not subject to withholding tax 

The Federal Court of Appeals has ruled that payments made under a procurement services agreement that did not involve a transfer of technology, are not considered royalties that are subject to withholding tax under the Brazil-Belgium tax treaty.

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More guidance on new federal tax amnesty program issued

The tax authorities have issued additional guidance on the “Special Tax Regularization Program,” specifically on the settlement of federal tax debts.

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Colombia

Financial information exchange agreement signed with Luxembourg

The agreement will allow the sharing of information on money laundering, terrorist financing, and other criminal activities.

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Tax authorities clarify VAT treatment of digital supplies made by nonresidents

The Tax and Customs Administration has clarified that supplies of digital services by nonresident companies to recipients located in Colombia are subject to Colombian VAT as from 1 January 2017.

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Mexico

Rules for application of reduced interest withholding tax rates revised

A recently introduced rule limits the application of the lower 4.9% and 10% withholding tax rates to interest payments that are deductible for the Mexican resident payer under the domestic provisions related to the OECD BEPS project.

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PRODECON and SAT publish transfer pricing documentation rules 

The tax authorities have published the final rules regulating the contents and filing of the master file, local file and CbC report.

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Peru

Transfer pricing information return and report abolished

The tax authorities have published guidance to remind taxpayers that, effective 1 January 2017, it is no longer necessary to file a transfer pricing information return and a technical report.  

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Other topics of interest

Indirect tax challenges of the digital economy in Latin America

Governments in Latin America are choosing different ways to apply indirect taxes to digital services. This regional diversity and complexity requires a watchful eye on developments.

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Disruptive tax technology: Spotlight on Latin America

Latin America regulators lead the way in deploying innovative technologies, prompting business to follow suit.

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The link between transfer pricing and customs valuation – 2017 country guide

The 2017 guide has been revised to include several country-specific regulatory and enforcement changes and advancements impacting related party customs valuation.

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Interested in more? Check out our Americas Thought Leadership and Latin America pages.

Contact us

For more information, please contact Americas Tax & Legal.

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Note: Latin America in Focus is not intended to be an inclusive update for all Latin America countries, but rather features key developments in the countries covered.

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