Argentina tax: New tax incentive regime introduced

The Argentine Executive Power introduced final rules on 21 September and 21 October 2009 that provide tax benefits for
investments in new capital assets earmarked for industrial activities and infrastructure works. The tax benefits for
investments in infrastructure works cover investments in the following:
- Electricity production, transportation and distribution;
- Production, transportation and distribution of hydrocarbons;
- Mining;
- Railroad and ports; and
- Construction of new refineries or expansion of existing facilities.

The tax benefits consist of either accelerated depreciation (three, four or five years) or a reimbursement of VAT for the
relevant investment, although the taxpayer will be able to request both benefits in certain cases. Companies wishing to
obtain benefits for investments in new capital assets earmarked for industrial activities must participate in a special bidding
process by 21 December 2009. While there is no bidding process for the benefits for infrastructure works, the project must
be deemed to be essential by the Argentine authorities. In any case, for both types of project there must be a disbursement
of funds equal to at least 15% of the total amount of the project between 1 October 2007 and 30 September 2010.