Tax Incentives in the Agricultural Sector

The Fiscal Code indicates the activities included in the agriculture sector are:

A. Agricultural Activity: production of food, salt, wood, and agricultural, poultry, livestock, and forestry raw material; harvesting of basic grains, such as rice, corn, sorghum, and other agricultural products.

B. Livestock activities: livestock, pig farming, poultry farming, beekeeping, and commercial breeding of other animal species.

C. Activities related to aquaculture: the cultivation, processing, and commercialization of hydrobiological resources produced under controlled conditions.

If you are engaged in or develop any of these activities, these are the main tax benefits available to you:

1. You are not obliged to file an annual Income Tax Return before the General Revenue Directorate (DGI) if your annual gross income does not exceed B/. 350,000.00.
2. The individual or legal entity that files its annual income tax return and is engaged in one of the agricultural or agro-industrial activities is exempt from such tax when its annual gross income does not exceed (B/. 350,000.00).
3. Exoneration of the presentation of the tax clearance certificate of the Income Tax in the Public Registry to any producer who manages for the first time the titling of a parcel of land whose surface is less than 50 hectares.
4. Tax exemption of up to 30% of the investment in agricultural, livestock, aquaculture, and agro-industrial activities, without this sum exceeding 40% of the income tax. This is subject to maintaining the investment in the production of goods or the introduction of technology for more than three years.

Legal Source:

• Article 710 of the Tax Code
• Law 2 of 1986 Incentives in Favor of Agricultural Production and Exports