VAT Exemption (22%). For production services and projects produced in Uruguay for foreign countries
With the purpose of promoting the film industry, since 2005 production services and projects that are filmed in Uruguay for foreign countries have a tax benefit, which consists of the exemption of the Value Added Tax (IVA, 22%) in accordance with Decree 220/998. Under this system, the tax amount of 22% shall be saved in several services hired for the project production -technicians, insurance, equipment rental, studios, rental of furniture, props, wardrobe, transport, catering and hotel costs being the most typical.
This incentive system has been improved and enhanced, and at present there are two different types of invoicing:
Invoicing to foreign companies:
for services invoiced to a company located in a foreign country the VAT (IVA) is exempted automatically.
Invoicing to companies located in Uruguay:
if the service is invoiced to a company located in Uruguay but the project is to be used in a foreign country, the Uruguayan producer may apply for such VAT exemption by presentation of the Exempt Certificate (Certificado de Exoneración) before I.C.A.U. (The Uruguayan Institute of Film and Audiovisual).
- 2005 - Analisis Tributario Ferrere
Industria audiovisual no exportara IVA
- 2006 - Analisis Tributario Ferrere
Servicios a la industria audiovisual sin IVA
- 2007 - El Observador - KPMG
Servicios de apoyo logistico
Decrees passed by the Uruguayan Government:
Investment Promotion Policy
Uruguay has developed an active system of tax benefits with the aim of promoting economic activities, both for local and foreign investors. Some of the effective promotion systems are under the Law of Duty Free Zones (Ley de Zonas Francas), the System of Short-term Imports (Régimen de admisión temporaria de importaciones), and the Free Port System (Régimen de Puerto Libre.). The most recent measure to promote investment is the Investment Promotion Law N° 16906 (Régimen de Promoción de Inversiones, Ley N° 16.906), which grants tax benefits to all investments, of any activity sector, with benefits reaching up to 100% of the eligible investment.
Treaties to avoid double taxation
Uruguay has subscribed and ratified treaties to avoid double taxation with Germany, Hungary, Spain and Switzerland.