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In brief

On 29 January 2021, Decree No. 42/2021 (“Decree“) was published in the Official Gazette, by which Law No. 27,605 of Solidarity and Extraordinary Contribution to Help Mitigate the Effects of the Pandemic (“Law“) was regulated.

Taxable base and valuation of assets

For purposes of valuation of the shares or participations in the capital of companies governed by the Corporations Law No. 19,550 (“Corporations Law“), the obligated subjects may opt between the following:

  1. The difference between the assets and liabilities of the company corresponding to 18 December  2020, according to the information that arises from a special balance sheet prepared as of that date.
  2. The company’s net worth for the last business year closed prior to 18 December 2020.

If option 2. above does not result in a contribution to be paid, the valuation of assets must be determined according to option 1.

Shareholders and partners who have modified the percentage of their participation between the closing date of the last business year (closed prior to 18 December 2020) and this last date will not be able to value the assets according to option 2).

In the event that the obligated subjects have shares or participations in different entities, the same option above will apply to all of its shareholding or participation in the capital of the companies.

Individuals and undivided estates with Argentine residence and/or of nationals of Argentina whose domicile or residence is in “non-cooperating jurisdictions” or “jurisdictions with low or no taxation” must declare as their own and include in the taxable base of the contribution the assets contributed to trusts or private interest foundations and other similar structures, companies or other entities of any kind without tax personality, for a percentage equivalent to their participation in them.

The indirect participations up to the third degree referred to in the Law, must be considered for the determination of the taxable base.

Argentine nationals whose domicile or residence is in “non-cooperating jurisdictions” or “jurisdictions with low or no taxation” as well as human persons and undivided estates residing abroad must designate a responsible substitute for purposes of complying with the obligations regarding the determination and payment of the contribution.

Personal and household objects referred to in Personal Assets Tax Law No. 23,966 will not be considered to determine the taxable base of the contribution.


The repatriation period referred to in section 6 of the Law must be computed in administrative business days.

The aggravated tax rate provided in section 5 of the Law will not be applicable to individuals and undivided estates that are Argentine residents and/or Argentine nationals whose domicile or residence is in “non-cooperating jurisdictions” or “jurisdictions with low or no taxation” if they repatriate  ̶  within the corresponding term  ̶  the funds that represent at least 30% of the total value of the financial assets located abroad.

Also, those obligated subjects must maintain the mentioned funds deposited in an account opened in the name of their holder (savings bank, checking account, fixed term or others), in entities included in the regime of Law No. 21,526, until 31 December 2021, or once the repatriation has been completed and the aforementioned deposit has been made, those funds must be allocated, partially or totally, to any of the following destinations:

  1. Its sale in the single market and free of exchange, through the financial entity that received the original transfer from abroad.
  2. The acquisition of negotiable obligations issued in national currency that meet the requirements of section 36 of Law No. 23,576.
  3. The acquisition of instruments issued in national currency intended to promote productive investment established by the National Executive Branch, provided that there is a regulation that provides so.
  4. It is contributed to companies governed by the Corporations Law, in which the contributor had shares or participations on the date of entry into force of the Law and provided that their main activity is not financial. Entities who have received the aforementioned contributions must not distribute dividends or profits to their shareholders or partners from the entry into force of the Decree and until 31 December 2021.

When the funds that have been deposited are allocated in part to any of the operations mentioned above, the remainder not affected by the latter must continue to be deposited in the accounts until 31 December 2021.

Financial assets

When entities or companies incorporated, domiciled or located abroad, directly or indirectly, carry out mainly operating activities  ̶  that is, when their income does not come from a percentage higher than 50% of passive income  ̶  the corporate and/or equivalent shares (private securities, shares, quotas and other shares) of those entities will not be considered financial assets.

However, said participation will be considered a financial asset if it does not exceed 10% of the capital of the entity or company incorporated, domiciled or located abroad.

The credits and/or foreign rights related to foreign trade operations carried out within the framework of operational activities are not considered financial assets. Neither credits nor guarantees, rights and/or derivative financial instruments, assigned to hedging operations that are closely linked to economic-productive activity and/or are intended to preserve the working capital of the company in which the subjects reached by the extraordinary contribution have participation.


The provisions of the Decree entered into force on 29 January 2021.

Click here to access the Spanish version: Argentina: El Poder Ejecutivo Nacional reglamentó la Ley Nro. 27.605 que estableció el Aporte a las Grandes Fortunas


Juan Pablo Menna is a partner in the Tax Practice Group in Baker McKenzie, Buenos Aires. He is a member of the Buenos Aires Bar Association and the Argentine Association of Fiscal Studies, and was a professor in Austral University.