The Paraguayan Government sanctioned and enacted on December 16, 2015 Law No. 5,542/15 (the “Law”), which guarantees the invariability of the Income Tax rate, equal treatment and legal certainty for those companies that avail themselves of the regime established therein by signing an investment contract with the governmental authorities. It also provides for additional benefits such as the exemption of the additional income tax rate for profit distribution and the reduction of the withholding of the same tax on the remittance of dividends abroad up to 50%, when the investments have a high social content.
The Law is applicable to new investments, as well as to investments made prior to its entry into force, provided that the investment complies with the established requirements, including the approval of the project and the execution of an investment contract.
The Law shall be regulated by the Executive Branch within 120 days of its enactment.
In the attached file you will find a summary of the Law.
In case you need further information, please do not hesitate to contact us:
Rodolfo G. Vouga – rgvouga@vouga.com.py; Jorge Figueredo – jfigueredo@vouga.com.py; Mauricio Salgueiro – msalgueiro@vouga.com.py; Andrés Vera – avera@vouga.com.py
