Page 12 - TCL International VILLETA BUSINESS PLAN AND FEASABILITY STUDY

G. Investments Incentives and Taxes

The government has enacted an investment promotion law which provides
business incentives for investments in the country. The purpose of the law
is to attract capital investments which must be a minimum of US$5 million.
The benefits of the law are the following:

• Full exemption of fiscal and city taxes.
• Full exemption of all taxes on dividends for 5 years
• Full exemption of duties on capital goods and raw materials.
• Full exemption of taxes on remittance resulting from interest,
commissions or capital.

Taxes are one of the lowest in the world. All main federal taxes, corporate,
value added, and personal are each fixed at 10%. The following table
shows the comparison with its neighbors, all members of MERCOSUR.

Table 2: Tax Rates in MERCOSUR

MERCOSUR % Argentina Brazil Uruguay Paraguay

Corporate tax 35 34 25 10

Personal tax 35 27.5 25 10

Value added tax 21 25 23 10
Source: Rediex

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