On March 12, at a ceremony at the Casa Rosada, President Macri presented the draft Law on the Knowledge Economy, a law granting tax benefits to knowledge generating activities and exports.
The project is presented as a continuity to the successful regime of the Software Law, which promotes the generation of employment and exports in the software sector, in turn requiring beneficiaries to invest in quality certifications, research and development and exports. After 15 years of experience, the Software Law overachieved its objectives. Today, the Argentine software industry is part of the third export group with a very favorable commercial balance, formal employment has enormously
increased, being today a full employment sector. Numerous companies throughout the country have grown internationally thanks to this regime, with starring cases as Mercado Libre, Despegar and Globant -among the most valuable companies in the country- and many other less known cases of companies with hundreds of employees and regional operations.
On this successful antecedent, the Law of Knowledge Economy expands the spectrum of promoted activities, with the common denominator of being generators of knowledge and talent, as well as exports. Thus, to the software development it adds areas such as biotechnology, audiovisual production, exportable professional services, robotization, aerospace and satellite industry.
The tax benefits consist in a reduction of labor taxes and the reduction of the Income Tax rate. The text of the preliminary draft implies an exemption from Social Charges for salaries of up to (approx) Ar $ 35,000 at 2019 values, and an additional monthly refund through a credit of (approx) Ar $ 5,000. Regarding Income Tax, a reduced rate of 15 is set.
The beneficiaries must meet certain requirements in terms of quality certification, investments in training or research and development, and exports.
The expectation is that the Law of Knowledge Economy may repeat the success of the Software Law allowing the recognized Argentine talent to become into thriving companies, generators of new technologies and knowledge, employment and exports.
If you want to know more about the Law of Knowledge, the requirements to obtain it and the benefits it may bring to your company, contact Palico Millé at palico@mille.com.ar