exoneración impuestos en bolsa de Perú

Peru and the tax exemption for transfers of securities carried out through the Lima Stock Exchange (LSE)

From January 1, 2020, the income tax exemption for the transfer of shares to the Lima Stock Exchange and other investment securities will take effect. The measure is made by the Peruvian government and will last until the end of 2022.
We talked with Héctor Aldea and Paulo Olivares, partners of Englobally Peru, about the positive effects of this measure and how they support companies in their tax decisions.

Peru and the tax exemption for transfers of securities carried

What is the positive effect of a measure like this in tax terms?

Paulo Olivares: The government has extended the tax exemption for two years, in order to not scare away foreign investors. We know that here in Peru, the stockbrokers, the companies that are dedicated to this market and the regulatory entities, by law would be obliged to withhold an income tax for capital gains. This would affect all people who make a profit by buying and selling stocks on the stock market today. Taxes are more harmful to foreign companies because the maximum rate is 30%. If a foreign company invests in Peru through the stock exchange, the regulatory entities would be holding them proportionally up to 30% of the profits as a maximum tax rate. Obviously, this drives away foreign investment and is the reason why Peru chooses to extend this tax exemption measure.
At the same time, it also benefits natural persons or companies that want to invest in the stock market. In these cases, the tax rate here in Peru, for capital gains, is 5%.

In what tax aspects does Englobally Peru advise companies?

Paulo Olivares: We focus more on tax planning. Companies are more focused on growing and making economic operations, so they leave our tax issue in our hands. What is tax planning? Basically, all the decisions that companies make to buy sell and do economic activities. All these activities are closely related to the tax issue, that is to say, if they make a purchase and sale operation and certain formalities have not been met, it will affect them and probably will pay a higher tax, if deadlines and dates are not met. That is where we come in and tell them, ‘wait, if you are going to do this operation, you must also see tax implications so that you do it properly, with the requirements of Peruvian regulations.’ If not, you end up paying more taxes, or affected by having more tax credit that you will not be able to recover.
70% of businesses in Peru are informal and 30% formal. This percentage is asked to fulfill certain obligations, either make monthly declarations, tax advances, or others.

How does Englobally Peru guide the strategic decisions of a company?

Héctor Aldea: We try, through a report based on the knowledge and experience we have of the country, to encourage the companies to make strategic tax and fiscal decisions, based on our opinion.

Paulo Olivares: In addition to what Hector said, a company that does business, it is fair, the right thing is to pay taxes only from the profits. That is established in the tax law, pay tax for the profits you get. But what happens? The formalities, the monthly declarations that tax administration requires, fulfilling the support of each operation, make companies devote part of their time and concern to solve these aspects. Then, it is there that we focus on the future and indicate, for each project or business team, what is the projection of the profits, and also we plan monthly tax issues. We want companies to pay for the right, the right thing.

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