Tax Credits: Deadlines for Transfers Change

With the approval of the tax reform, in Nicaragua the period for exporting companies to transfer the tax credit to the producer or manufacturer was reduced from three to two months.

Thursday, April 4, 2019

At the end of February, the National Assembly approved the amendment to the Tax Concertation Law, which increases from 1% to 3% the income tax of large taxpayers and also shortens the deadline for exporters to transfer the tax credit to producers, which is 1.5% on the value of FOB exports.

See "More Taxes in Times of Crisis"

The change is not well received by the business sector, because according to Guillermo Jacoby, president of the Association of Producers and Exporters of Nicaragua (APEN), this change "... brings greater illiquidity to the sector."

In statements given to, Jacoby argued that "... The exporter is paying more INSS, is paying more for inputs and fertilizers, and those raise your costs, in addition that there is no financing, all that takes away liquidity and if you add this reduction of the term, the pressure is greater, taking one month off the exporter means increasing the shortage of money."

The article reviews that "... Based on article 180 of the regulations to the reform of the Tax Concertation Law, Erwin Rodriguez, senior manager of Taxes and Legal of PwC Nicaragua, explained that 'if not transferred, the exporter will not be entitled to the tax credit and if the exporter already credited it in their declarations, must return it to the General Revenue Directorate (DGI)'."

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