World Finance

World Finance

July 21, 2017 04:30 ET

Argentina's taxing issue

LONDON, ENGLAND--(Marketwired - July 21, 2017) - For businesses in Latin America, managing withholding taxes is a trying task. They are faced with a complex and constantly shifting web of regulations that requires keen local knowledge to get right. Often, tax managers cannot go 100 days without being hit by legislative changes in rules, rates and calculations. Lest they slip up, there can be heavy consequences. In Argentina, for instance, failure to pay can land businesses with a hefty fine of up to ten times the amount not paid.

Undeniably, Latin America is a particularly difficult regulatory setting. While Brazil is home to more than 80 different taxes, Argentina has a grand total of 24 autonomous tax jurisdictions, each with its own unique set of regulations. Even Mexico's more straightforward approach holds awkward particulars that companies must learn to manage.

Despite an environment plagued with complexities, new technological solutions are emerging that could help ease the pressure for businesses. For instance, software platforms offered by Vertex - a leading tax solutions firm - can play a hugely valuable role in streamlining complex tax calculations. Indeed, the right blend of tax automation and leading tax data management practices, alongside local knowledge and expertise, can make even the most cumbersome system much more manageable.

Such solutions are all the more pertinent during a period of flux, when regulations are more likely to undergo rapid changes. Faced with periods of economic stress, governments are eager to find faster ways of collecting revenue, which can spur a faster pace of change in any regulatory setting. This looks to be the case over the coming years, making taxation support ever more important. Software programmes such as those provided by Vertex thus act as an invaluable tool that enables firms to prepare and react to any change in the regulatory framework - no matter how big or small.

To find out more about Latin America's taxing issue and how businesses can best respond, be sure to pick up a copy of the next World Finance magazine, available online, on tablet and in print.

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