Digital economy and taxes: Uruguay set an innovative precedent in relation to the taxation of digital platforms.
In 2017, Uruguay has included for the first time on its Annual National Budget Law rules tending to regulate the taxation of a new kind economic activities developed through software applications at a global level.
The provisions of the referred Law were regulated in the current year, through the issuance of Decree 144/018 and the recent Tax Resolution 9270/018.
In this way, Uruguay takes the lead on this matter, as the taxation of such platforms is still under review in most of the countries of the world.
The main difficulty that this kind of activities raise, are related to the fact that are generally developed by non-resident entities, with a high technological component, that enables those companies to perform a relevant number of transactions in a certain territory without even having physical presence on it.
This implies a challenge for Uruguay, as well as for the rest of the countries in the world, because guidelines must be set up in order to determine where and how is generated the income, and afterwards, based on that, determine which will be the taxable base to be considered for a particular tax.
If you wish to learn precise details, please contact our office. Uruguay Property will explain which are the provisions under the Income Tax on Non Residents (IRNR as per its acronym in Spanish) and the Value Added Tax (VAT) in Uruguay, to consider that an income derived of these new economic activities must be taxed in Uruguay.