Argentina: Promotion of modern biotechnology and nanotechnology

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In short

By National Law No. 27,685 (“Right“), published on September 16, 2022, Law No. 26.270 has been amended, extending throughout the national territory the regime for the promotion of the development and production of modern biotechnology and nanotechnology. The regime will be in force until December 31, 2034.

The law provides for the following tax advantages: (i) accelerated depreciation of capital goods, special equipment and parts or elements constituting these new goods, which have been acquired for the project; (ii) advance reimbursement of the VAT corresponding to the goods acquired for the project; and (iii) the granting of a tax credit voucher equivalent to 50% of expenses paid for the hiring of research and development services from institutions that are part of the national public system of science, research and development. technology and innovation. The good tax credit will be valid for 10 years and it will only be transferable once.

On point

The law includes the concept of nanotechnology in the definition of “modern biotechnology”, i.e. any technological application based on rational knowledge and scientific principles that derive from biology, biochemistry, microbiology, bioinformatics, molecular biology and genetic engineering, or which uses living organisms. or parts thereof, either for the production of goods and services or for the substantial improvement of products and production processes.

The law provides the following tax benefits:

  1. Related to income tax: accelerated depreciation of capital goods, special equipment and parts or elements constituting these new goods, which have been acquired for the project
  2. Relating to value added tax (VAT): it establishes the advance reimbursement of the VAT corresponding to the goods acquired for the project.
  3. Finally, it should be mentioned that in the case of investigation and development projects, the beneficiaries will also benefit from a tax credit voucher equivalent to 50% of the expenses paid for the hiring of investigation and development services. development with institutions that are part of the national public science, technology and innovation system. The good tax credit will be valid for 10 years and it will only be transferable once.

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