On March 8, 2023, the Chamber of Representatives rejected the tax reform bill. As a result, the Executive will not be able to present a new bill on the matter for one year, unless there is an agreement of the Senate by a two-thirds majority.
Among the matters considered in the bill were: the disintegration of the tax system and the creation of a dual system; the creation of a tax on accumulated profits pending taxation with the final taxes; the reduction of the IDPC rate for companies that join the Dual System, from 27% to 25%; the creation of a new substitute tax for the final taxes; the expansion of the SII’s inspection powers.
The rejection of the bill also implies, among other things, the rejection of the wealth tax; the increase of the top marginal rate of the Global Complementary Tax; the affectation of revocable donations with the inheritance and donations tax; the modification of the valuation rules contained in the inheritance and donations tax law; the elimination of the leasing of furnished real estate as a VAT taxable event.
Finally, it is important to bear in mind that, as a result of the rejection of the bill, companies under the Pro-SME regime would be taxed with the IDPC at a rate of 25% in the tax year 2024, not being applicable the gradual increase proposed by the Executive.