Mining in Argentina
Mining in Argentina
With a surface of over 2 million square kilometers, Argentina is a very rich country in mining resources. Consequently, the Mining Journal Survey has ranked our country sixth in mining resource potential. Growth perspectives for the Argentine mining sector are highly encouraging for the next ten years, given a sound legal framework, increased investment opportunities, support to small and medium-sized mining companies and an engagement in sustainable development. Thus, Argentina has all the factors required to become a mining country, a fact that ensures the future growth of this activity.
The legal framework based on the Mining Code has been recently updated by the unanimous passing of several codes since 1993, and in this way proves to be a consolidated and dynamic structure, in accordance with international mining business standards.
CODE 24.196 on Mining Investments has turned Argentina into an attractive target in the same way as its neighboring countries, through the development of incentives such as 30 years of fiscal stability for new projects or for enlarging existing ones. Taxing favors risk investments through access to equipment and machinery at international prices. As well, it establishes a limit of 3% upon royalties which can be charged by the Provinces if raw material is benefited into added value.
CODE 24.224 on Mining Rearrangement and CODE 24.498 on Mining Updating establish the royalty values comparable to international ones, removed out-of date codes from the Mining Code, modify the areas allowed for exploration and exploitation, create a figure of exclusive air prospection, reestablish the concession system for the exploration and exploitation of nuclear minerals and extend the usufructs period.
CODE 24.402 on VAT Financing establishes regulations for the financing and refund in advance of the value added tax applied to investments in infrastructural works (roads, electrical wiring, water, etc.) or the purchase of capital goods for new mining projects.
CODE 24.585 on Environmental Protection for Mining Activity, merely preventive, establishes rules as well as procedures through impact testing in order to avoid nonreversible damage as a consequence of mining activity.
18 – Registration to CODE 24.196 on Mining Investments:
Electroquímica Del Neuquén, S.A., AMA RESOURCES’ strategic partner has taken the necessary steps to register in the mining investment program mentioned above.
19 – Reduction and exemption of taxes
Value Added Tax
According to Art 8, subsection d) of the Value Added Tax Grade, mineral exportations are tax free.
Tax on Income
Presumed minimum income according to Grade Nº 25,063 is tax free.
Tax on Assets
Those individuals who carry out mining activity are exempt of tax on assets as established by Grade Nº 25,063.
Import rights on capital assets
Those registered in the mining investment system are exempt of payment of import rights and any other right, special tax, correlative lien or statistics rate, due to the introduction of capital assets and special equipment needed for the mining activity.
Tax on liquid fuels
Decree 377/98 by the National Executive Power establishes tax exemption on fuels used as mining fuel.
Right of Royalties of the Province of Neuquén and Salta
As a right of mineral exploitation, taxation of 3% on the quantity of mineral extracted in the mine opening is required. However; concentration of the raw mineral creates a tax exemption thus processed mineral does not incur such taxation.
Reduction and exemption of taxes
Tax on Gross Income
Mining activity is exempt of Tax on Gross Income.
Financial and insurance operations in the mining activity are exempt of Seal Tax.
There are no municipal taxes for municipal services in our activity