BuySellBA
Administrator
Personal Property: Due to inflation, the tax value of a property in CABA must be multiplied by 113 - La Nacion Propiedades
Source:
Bienes Personales: por la inflación, el valor fiscal de una propiedad en CABA debe multiplicarse por 113
La inflación del 2023 que superó el 211% impactó en la valuación fiscal de los inmuebles que se tiene en cuenta para pagar Bienes Personales
www.lanacion.com.ar
February 6, 2024
Inflation in 2023, which exceeded 211%, impacted the tax valuation of real estate that is taken into account to pay for Personal Property
By Candela Contreras and Maria Josefina Lanzi
The personal property tax payable in 2024 can now be calculated
Those who have a property in the City of Buenos Aires and pay for Personal Property will feel an adjustment to their pockets. With the December CPI data, the index that defines the adjustment that must be made to tax valuations can now be calculated . With an annual inflation of 211.4% , that index is 28.3118, that is, 2831.18%.
In this way, the index that should be used to update the tax valuations of the properties can now be calculated . This index “takes the 2017 tax valuation and adjusts it for the variation in the CPI from December 2017 to December of the year in which the tax is being settled or calculated,” explains Sebastián Domínguez , accountant and CEO of SDC Asesores Tributarios.
This means that the valuation of Buenos Aires properties must be multiplied by 113.2472 (4 x 28.3118) and in the Province by 28.3118. These numbers indicate that valuations increased 400% compared to the previous year if one takes into account that last year the tax value of properties in the Capital multiplied by 36 (now 113) and 9 in the case of those located in the Province of Buenos Aires (now 28).
That is, to calculate the payment of Personal Property in 2024 , with an annual inflation of 211.4% , the VFH of Buenos Aires properties must be multiplied by 113.2472 (4 x 28.3118) and in the Province by 28. 3118, more than 400% compared to the previous year: which was 36 in CABA and 9 in the Province.
The INDEC published the information on the variation of the CPI for December 2023
The multiplication by four in properties in the Federal Capital is explained because in 2022 the AFIP once again changed the criteria that was used exclusively to value Buenos Aires properties to calculate the real estate tax. Therefore, according to the Tax Code , in the city of Buenos Aires the Homogeneous Fiscal Assessment (EFH) must be multiplied by a unit of constructive sustainability, which can be any value, and which in this case was set at four.
This meant that, for example, if the VFH of a property in 2017 was $500,000 , the new measure multiplied it by four to $2 million. “This would be the valuation for 2017 and then you have to update that number to 2023 by multiplying it with the CPI (inflation), that's why the number is 113,” details Domínguez.
The AFIP measure caused the tax value of Buenos Aires properties to quadruple in one fell swoop, an increase that hits taxpayers' pockets squarely. In some cases, it implies that the taxpayer moves to a higher tax scale and has to pay a higher rate on their assets.
It is worth clarifying that 2017 is taken because with the tax reform of that year it was established that until the Federal Property Valuation Body created by Decree 938/2018 establishes a general valuation criterion, the valuation will be applied as of December 31 from 2017 updated to the CPI for the period being settled.
“In any case, in practice it is not that much more will be taxed because in most cases, in the tables, the non-taxable minimums and the deduction were adjusted by the CPI, which was 211.4%. Therefore, you will pay a higher amount due to inflation , but in real terms it will be similar to last year ,” the tax expert clarifies.
The non-taxable minimums and the deduction were adjusted by the CPI, which in 2023 was 211.4 percent
Who will pay the personal property tax
For 2023, if the property is used as a residence, a non-taxable minimum of $136,887,041.42 is taken. “This means that, if the property does not exceed that value and does not have other assets, it does not have to pay the tax ,” adds Domínguez. If it exceeds that value, the surplus is considered together with the remaining assets (including other real estate).Another case, in which you own other assets, a non-taxable minimum of $27,377,408.28 is applied and the excess is taxed at the progressive scale that goes from 0.50% to 1.75%. But also, increased rates may be applied for goods abroad , if applicable, explains the specialist.
However, Domínguez clarifies that the Government had included in the fiscal package of the omnibus law modifications to the personal property law, eliminating discrimination between assets located in the country and abroad and reducing the maximum rate to 1.50%.
The accountant adds that a special regime was also contemplated that would allow taxation at the rate of 0.75% multiplied by the coefficient 5 to be freed from paying the tax until Fiscal Period 2027, inclusive, and with a fiscal stability clause. in property taxes.
Other modifications contemplated in the fiscal package were to increase the non-taxable minimum per property intended for habitation to $350,000,000 and the general non-taxable minimum to $100,000,000.
In summary, the specialist reflects that this modification would be important and that the tax pressure on assets can be very relevant with the current treatment, and that the implementation of a moratorium is also key to be able to regularize old debts and the money laundering that would allow them to be externalized. capital considering this personal property reform because otherwise the latter will have little chance of success.
It remains to be seen how the treatment evolves and whether the modification finally becomes law. However, the tax package was withdrawn and it is now unknown whether these changes can be negotiated after the approval of the omnibus law.
Personal property law: how a property is valued
The personal property tax law establishes that to value a property, the acquisition cost or value on the date of entry into the updated assets must be taken, deducting the corresponding amortization (residual value), Domínguez responds and continues detailing the process.This value cannot be less than the tax base established for the payment of real estate taxes or similar taxes in force as of December 31 of the year for which the tax is settled or the fiscal value determined on that date.
Currently, in accordance with Law 27,480 , the tax base or tax value as of December 31, 2017 updated by the CPI as of December 31 of the year in which the tax is settled must be taken. That is, the highest of the three values must be taken (residual value, tax base for real estate taxes, tax value).
In the event that the property does not have a tax base set as of December 31, 2017 for the purposes of paying real estate taxes or similar taxes or tax valuation - for example a property built in 2020 and purchased in 2021 - according to the wording of the law, the comparison should not be made with the tax value.
The AFIP changed the criteria it used exclusively to value Buenos Aires properties and now tax valuations must quadruple in the city of Buenos Aires
The AFIP criteria for properties in CABA
In the city of Buenos Aires , the Tax Code establishes that the tax base of the real estate tax is the homogeneous tax valuation (VFH) and cannot be higher than 20% of the market value of the property.The AGIP indicates that VFH is the fiscal value of the property and is calculated considering the economic value and incidence of the land according to geographical location and environment and the commercial incidence of the district, on the one hand, and the real value of the building according to the category, destination, quality and features.
On the other hand, the Tax Code creates the Contributory Sustainability Unit (USC) and defines it as the coefficient used to generally modify the magnitude of the tax , in accordance with the tax policies implemented, in order to have a tool that makes it possible, based on of tax policies affect the amount of taxes. The USC is an index that allows technical valuations to be kept uniform and homogeneous , without affecting the tax base for other taxes or for exemptions for retirees and disabled people.
In 2022, through Opinion (DIALIR) 1/2022, it is considered that the value to be taken as a comparison is the one that arises from multiplying the VFH x the USC , that is, by 4. In this way, the change in criteria directly increases by 4 the tax value of real estate in CABA.
www.buysellba.com
