Category: Uncategorized

Executive Summary:

Standard	Content	Date
Decree No. 8,878	The Selective Consumption Tax ("ISC") rates applicable to tobacco, cigarettes, essences and similar products were increased.	February 22, 2023
Decree No. 8,894	The amounts in USD provided for in Law No. 60/1990 for access to additional tax benefits for investment projects and others were increased.	February 28, 2023
Decree No. 8,895	The reduction of (i) the Value Added Tax ("VAT") taxable base for certain goods under the tourism regime, and (ii) the ISC tax rates for certain electronic products is extended until April 30.	February 28, 2023
Decree No. 8,896	The validity of the special ISC tax bases for Diesel/Oil Gas Type III is extended until March 31, 2023.	February 28, 2023
General Resolution No. 126	The Undersecretariat of State for Taxation ("SET") issued administrative measures related to the confirmation of the monthly voucher registration, established in General Resolution No. 90/2021.	February 24, 2023

More information:

► Decree No. 8,878/2023 - Increased ISC rates for tobacco, cigarettes, essences, and similar products.

The Executive Branch issued Decree No. 8,878/2023, by which it resolved to increase by 2% the ISC rates applicable to tobacco, cigarette, essences, and similar products by amending Article 8 of the Annex to Decree No. 3,109/2019 (ISC regulations). Thus, the new rates went from 20% to 22%, being fixed as follows:

Taxable goods	Former tax rate	Current tax rate	Difference
1.- Cigarettes scented or made with blond Egyptian or Turkish tobacco, virginia and the like.	20%	22%	+2%
2.- Cigarettes in general not included in the preceding paragraph.	20%	22%	+2%
3.- Any type of cigarettes.	20%	22%	+2%
4.- Dark or blond tobacco, chopped or otherwise, except in leaf tobacco.	20%	22%	+2%
5.- Tobacco processed, chopped, in strands, in powder (snuff) or in any other form.	20%	22%	+2%
6.- Essences or other tobacco products to be heated, vaporized, inhaled or sniffed with electronic cigarettes, vaporized or similar.	20%	22%	+2%

The provision mentioned above does not have an effective date, so it should have become effective as of March 1, 2023; that is, the day after its publication in Official Gazette No. 41, on February 28, 2023.

In February 2022, the Executive Power increased the ISC rate on tobacco, cigarettes, and similar products from 18% to 20% through Decree No. 6,619/2022.

► Decree No. 8.894/2023 - Increased the amounts in USD for access to additional tax benefits established in Law No. 60/1990 for investment projects and others.

The Executive Branch issued Decree No. 8,894/2023, which increased from USD 5,000,000 to USD 13,000,000,000, the original investment amount required to access the additional tax benefits provided for in Law No. 60/1990, as amended. This new amount will be applied to the requests for approval of benefits provided in the referred law for investment projects that enter as of March 3, 2023.

The tax benefits affected by this amendment are the following: (a) exemption from the Dividends and Profits Tax ("IDU") or any other tax that may apply to the distribution of dividends and profits; and (b) exemption from the payment of interest, the Non-Resident Income Tax ("INR") and the VAT. On the other hand, when the investment project exceeds the new amount of USD 13,000,000, it must be prepared by technicians or consulting firms registered in the Registry of Consultants of the Ministry of Industry and Commerce.

This modification was a budgetary measure to reduce the tax expenditure of the Paraguayan State, based on Article 289 of Law No. 7,050/2023, which approves the General Budget of the Nation for the fiscal year 2023. In addition, this law empowers the Executive Power to update the amounts outlined in the referred Law No. 60/1990 based on the variation of the Consumer Price Index ("CPI") published by the Central Bank of Paraguay ("BCP"), accumulated until November of the fiscal year 2022.

Although nowhere in the norms mentioned above is it expressly indicated which was the reference year to measure the variation of the CPI, there are mentions in Decree No. 8,894/2023 that suggest that such year would have been 2004. This deduction takes force if we consider that, according to the statistical annex of the BCP inflation report, the CPI as of November 2022 is 2.62 times the CPI of December 2004 and that the current amount of USD 13,000,000 represents 2.6 times the previous amount of USD 5,000,000.

► Decree No. 8,895/2022 - The reduction of (i) the VAT taxable base for certain goods under the tourism regime, and (ii) the ISC tax rates for certain electronic products is extended until April 30, 2010.

The Executive Power issued Decree No. 8895/2023, whereby it resolved to extend until April 30, 2023 the effectiveness of the following Decrees:

Decree	Provision
1.- Decree No. 8,048/2022	By which the taxable base of 5% was established for the liquidation of VAT at the time of importing goods under the tourism regime.
2.- Decree No. 8,782/2023	Whereby the temporary modification to 0.5% of the ISC rates for cellular telephony devices and various household appliances, mentioned in paragraphs 2 and 3 of Article 12 of the Annex to Decree No. 3,109/2019, was provided for.

In accordance with the provisions of the measure related to the tourism regime, the taxable base for VAT remained at 5% for the goods referred to in the annex to Decree No. 1,931/2019. Thus, the effective rate is as follows:

Period	Taxable Base	10% VAT effective tax rate	5% VAT effective tax rate
Until April 30, 2023	5%	0,5%	0,25%

As of May 01, 2023, the taxable base of the VAT applicable to the importation of goods subject to the tourism regime will be 15% of the customs value (including customs duties), according to Decree No. 1,931/2019 and its amendments.

On the other hand, regarding the measure adopted concerning the ISC on electronic devices, the Executive Power had resolved to temporarily reduce by half the ISC rates for the following goods:

Product	Regular tax rates	Reduced tax rates	Difference
Automatic data-processing machines and units thereof; magnetic or optical readers, copying machines, hectographic machines, mimeographs, address printing machines, electrical machines, apparatus and equipment and parts thereof; sound recorders and reproducers, television reception apparatus, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus, video monitors and video projectors	1%	0,5%	-0,5%
Cellular telephony devices and portable terminals	1%	0,5%	-0,5%

As of May 1, 2023, the 1% ISC rates for cellular telephones and various household appliances will be applied again unless the Executive Branch extends the validity of these provisions again.

► Decree No. 8.896/2023 - Extension until March 31, 2023 of the special ISC tax bases for the importation of Type III Diesel/Oil Gas.

Through Decree No. 8,676/2023, the Executive Power had fixed, on a transitory basis, the ISC taxable base for the importation of Type III Diesel/Oil Gas, setting it at ₲ 3,083.3 per liter until January 31, 2023. This provision was later extended until February 28, 2023, through Decree No. 8,781/2023. Thus, the abovementioned provision is again extended until March 31, 2023, by Decree No. 8,896/2023.

Therefore, until March 31, 2023, the tax base for Type III Diesel/Oil Gas/Diesel is determined at ₲ 3,083.3 per liter, as provided in Decree No. 8,676/2023. After this date, the taxable base reverts to ₲ 3,777.78 per liter, provided for in the annex to Decree No. 3,109/19 as amended, unless this special regime is further extended.

► General Resolution No. 126/2023 - Whereby the SET takes administrative measures with respect to the confirmation of the monthly voucher registration stub established in General Resolution No. 90/2021.

Through General Resolution No. 126/2023, the SET provided that, exceptionally, the failure of taxpayers who are obliged to file monthly vouchers through the Marangatú Tax Management System to confirm the voucher registration stub for the tax periods of January, February, March, April and May 2023 will not constitute tax non-compliance. Specifically, this provision affects the tax liability under code No. 955-REG. MONTHLY VOUCHER.

This means that the lack of confirmation of the voucher registration stub within the period contemplated in General Resolution No. 126/2023 does not entail the negative consequences of non-compliance -other than the fine for contravention-such as the impossibility to generate the tax compliance certificate, increase of the taxpayer's risk index, etc.

This measure complements the provisions of the SET in General Resolution No. 124/2023, which had established the same measure, but was limited to the lack of confirmation of the filing stub for registering tax vouchers corresponding to the fiscal year 2022 under code No. 956- REG. ANNUAL REG. This last resolution also provided that, for both types of registration (annual and monthly), the penalty for contravention was exempted until July 31, 2023.

During the term of validity of General Resolution No. 126/2023, the SET will continue to receive the registration of vouchers and the confirmation of the filing slip.

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El 23 de enero de 2023, el Ministerio de Trabajo, Empleo y Seguridad Social (MTESS) ha dictado la Resolución N° 66/2023 (“Resolución”) a través de la cual establece que la presentación de planillas laborales (“Planillas”)[1] correspondientes al ejercicio del año 2.022 deberá realizarse en el periodo comprendido entre el 1 de marzo al 30 de abril del 2.023.

La presentación de las planillas se hará exclusivamente por medio del sistema informático del MTESS.

Las empresas que no presenten las Planillas en el plazo, orden y modalidad fijados en la Resolución serán sancionadas con multas que van de los 10 a los 30 jornales mínimos, conforme el siguiente cuadro[2]:

Jornales mínimos	Cuando la mora en la prestación sea:	Será sancionada con una multa de
10	Menos de 30 días	Apróx. G. 980.890
15	Entre 31 días y 60 días	Apróx. G. 1.471.335
20	Entre 61 días y 90 días	Apróx. G. 1.961.780
25	Entre 91 días y 120 días	Apróx. G. 2.452.225
30	Más de 120 días	Apróx. G. 2.942.670

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[1] https://www.mtess.gov.py/application/files/8516/7760/1865/Resolucion_N_66.pdf

[2] https://www.mtess.gov.py/application/files/9815/8107/5032/DECRETO9368_18.PDF

El 9 de diciembre de 2022 el Poder Ejecutivo promulgó la Ley nro. 7021/2022 “De Suministro y Contrataciones Públicas” (“Nueva Ley”) que el objetivo de dotar a la administración del Estado con un nuevo marco jurídico más acorde a las exigencias de mayor eficiencia, integración y transparencia de todo el sistema de compras públicas.

En ese sentido, las novedades principales de la Nueva Ley podemos mencionar:

a) Creación del Sistema Nacional de Suministro Público (“SNSP”)[1]: El SNSP introduce criterios para lograr una mayor racionalidad y eficiencia en el uso de los recursos públicos; de acuerdo con la Nueva Ley, el SNSP es el conjunto de principios, procesos, normas, procedimientos técnicas e instrumentos macro para la provisión de bienes, servicios, consultorías y obras públicas, los cuales son llevados a cabo a través de la Cadena de Suministro. El SNSP estará regulado por el Ministerio de Hacienda y bajo la responsabilidad colegiada de:

• El Ministerio de Hacienda.

• La Dirección Nacional de Contrataciones Públicas (DNCP).

• El Comité de Suministros Públicos.

• Las Unidades Operativas de Contratación (UOC) de las entidades públicas que se encuentren bajo el ámbito de aplicación de la Nueva Ley.

• Los Administradores de contratos o las Unidades de Ejecución de Proyectos de las entidades públicas que se encuentren bajo el ámbito de aplicación de la Nueva Ley. 

• Los demás responsables definidos en la reglamentación de la Nueva Ley.

b) Ministerio de Hacienda como Órgano Rector del SNSP:  Con la Nueva Ley el Ministerio de Hacienda tiene un rol preponderante en los procesos licitatorios regidos por la Nueva Ley. En ese sentido, y en su carácter de órgano rector, el Ministerio de Hacienda tendrá – entre otras – las siguientes funciones:

• Diseñar y emitir las políticas generales del SNSP orientadas a fortalecer la sostenibilidad fiscal y mejorar la calidad del gasto en las contrataciones públicas;

• Proponer los reglamentos que regulen el SNSP;

• Programar, coordinar y supervisar las etapas que componen el SNSP;

• Evaluar la adecuación de las contrataciones a las políticas y reglamentos del SNSP.

c) Creación de la Cadena Integrada de Suministro Público[2] (“Cadena de Suministro”): entendida como el proceso que rige y coordina el SNSP y las contrataciones regidas por la Nueva Ley, que permite asegurar el aprovisionamiento y la trazabilidad de los bienes y servicios adquiridos por los entes públicos, y que tiene la finalidad de lograr objetivos estratégicos y operativos de las distintas autoridades contratantes, optimizando el uso de sus recursos al mismo tiempo. La Cadena de Suministro abarca:

• Planificación de necesidades;

• Programación presupuestaria;

• Gestión de las contrataciones;

• Administración de los contratos;

• Evaluación de metas.

d) Introducción de nuevos Principios rectores (“Principios”): los Principios cambian en gran medida los paradigmas y criterios de selección de proveedores y de adjudicación de licitaciones; en ese sentido, bajo la Nueva Ley el criterio preponderante para la adjudicación deja de ser el del precio más bajo y entran a evaluarse otros aspectos de orden cualitativo, de inclusión social y de sostenibilidad ambiental. En ese sentido, es preciso mencionar algunos de los Principios más novedosos como son los de: “Valor por Dinero”, “Sostenibilidad económica, social y ambiental”, “Integración”, “Economía, Eficacia y Eficiencia”[3];

e) Posibilidad de consolidar sus adquisiciones: El objetivo de esta disposición es que a través de la consolidación de las compras las contratantes puedan obtener mejores condiciones por parte de los potenciales proveedores[4];

f) Obligatoriedad de llevar a cabo compras conjuntas[5]: Estará a cargo del Ministerio de Hacienda evaluar, sobre la base de los programas anuales de contrataciones de cada entidad contratante, cuáles bienes y servicios que deberán ser objeto de compras conjuntas. La determinación del Ministerio de Hacienda tendrá carácter vinculante y el proceso estará coordinado por la Dirección Nacional de Contrataciones Públicas (DNCP).

g) Inclusión de las MIPYMES: (i) Licitaciones de Menor Cuantía con un valor inferior a cinco mil (5000) jornales mínimos[6], estarán reservadas a las Mipymes; (ii) Contratación inclusiva: modalidad diseñada para oferentes domiciliados en un departamento o municipio especifico u organizaciones de dichas comunidades, dirigida exclusivamente a las Mipymes o grupos de interés vulnerable o bajo condición de protección social.

Las mencionadas más arriba constituyen las novedades más relevantes ya que contribuyen a cambiar de forma sustancial la estructura de los procesos de contratación pública en el Paraguay. Sin embargo, no son las únicas; la Nueva Ley, introduce otras novedades de menor calado, pero igualmente relevantes, tales como:

• Cambio de criterio en caso de participación de sucursales: La Nueva Ley establece que, en caso de que se presenten sucursales a los procesos licitatorios, para los fines de la adjudicación sólo serán tenidas en cuenta las capacidades, experiencias y aptitudes que la sucursal haya acumulado desde su constitución, excluyendo la utilización de las cualidades de la matriz u otras empresas afiliadas. Esta es una novedad significativa puesto que, históricamente, utilizar la experiencia de la matriz siempre ha sido un recurso muy utilizado por empresas extranjeras que desean tomar parte de procesos licitatorios nacionales.

• El Registro de Compradores Públicos: en este registro se registrarán a los funcionarios públicos que participan de las diferentes etapas de los procesos de contratación. El objetivo del registro es, por un lado, dar mayor transparencia y trazabilidad a los procesos de compras y, por el otro, hacer que sean más eficientes los procesos evitando duplicidades y/o la carga de datos de manera repetitiva.

• Simplificación de contrataciones convencionales: Se establecen dos categorías específicas para los procedimientos de contratación convencional: (a) la Licitación Pública para compras que superen cinco mil (5000) jornales mínimos; y (b) Licitación de Menor Cuantía para contrataciones que sean inferiores a cinco mil (5000) jornales mínimos. Las últimas, como hemos visto, reservadas a proveedores categorizados como MYPIMES.

• Acuerdo Internacional: modalidad dirigida a proveedores nacionales e internacionales, a fin de contar con varios proveedores para la misma prestación. Si bien se entiende que este procedimiento lo que busca es incrementar y mejorar la competitividad entre los proveedores con la finalidad de cumplir, entre otros, con el principio de valor por dinero, debemos esperar a la reglamentación de la Nueva Ley para conocer el desarrollo del procedimiento y su alcance concreto. 

• Proceso para sociedades anónimas con participación accionaria mayoritaria del Estado: diseñada para las sociedades anónimas bajo este régimen que actúen en competencia con el sector privado para la adquisición de bienes y servicios.

• Compras sostenibles: La Nueva Ley prevé que los procesos de contratación pública deberán ajustarse, entre otros, a criterios que responsan a políticas de compras públicas sostenibles. Al respecto se contempla que el SNSP desarrolle e implemente procesos de contratación que fomenten el desarrollo social económico y preservación ambiental. En cuyo caso serán de aplicación los principios de “valor por dinero”, “economía circular” and “compras públicas estratégicas”, asimismo, se tendrán en cuenta otros criterios a ser considerados, caso por caso, en función de las características de la licitación de que trate.

• Procesos jurídicos ante la DNCP: La Nueva Ley establece la facultad de la DNCP de rechazar denuncias o protestas de naturaleza dilatorias por manifiesta falta de fundamentos, con el objetivo de evitar demoras innecesarias en los procesos de contratación. Además, en caso que la protesta sea procedente, la Nueva Ley fija un plazo perentorio de 35 días hábiles para su resolución.

• Sanciones: La Nueva Ley faculta a la DNCP a sancionar a las personas físicas que al momento de la comisión de la infracción hayan ejercido cargos de dirección, administración, representación legal o como apoderados y también a aquellas personas o beneficiarios finales que hayan tenido participación en el capital social.

Habiendo considerado las principales novedades introducidas por la Nueva Ley, es el momento de hacer mención al hecho que la misma carece de reglamentación, esto tiene un doble efecto: (i) varios artículos de la Nueva Ley requieren de reglamentación para poder conocer su alcance real y, por ende, su aplicación práctica, por un lado; (ii) por el otro, la entrada en vigor de la Nueva Ley está supeditada a su reglamentación, por lo tanto, hasta que ello no ocurra, todos los procesos licitatorios seguirán siendo regidos por la Ley Nro. 2051/03 “De Contrataciones Públicas” (“Ley 2051”). En ese sentido, no podemos pasar por alto la inconsistencia entre lo dispuesto por el Art. 160 y el 157 de la Nueva Ley; aquel establece que “La presente Ley entrará en vigencia a partir de la publicación del decreto reglamentario.”, mientras que éste dispone “El Poder Ejecutivo, a través del Ministerio de Hacienda, dictará el Decreto reglamentario de la presente Ley dentro del plazo de 120 (cientoveinte) días a partir de su entrada en vigencia.” A nuestro entender, una correcta exegesis de ambas normas debe hacerse en el sentido de la prevalencia del Art. 160 por sobre el 157, con la obligación del ejecutivo de reglamentar la Nueva Ley dentro de 120 días. 

Si bien en la práctica las instituciones públicas siguen convocando licitaciones bajo la Ley 2051, siendo la Nueva Ley de uno de los cuerpos normativos más relevantes de nuestro ordenamiento, la Autoridad de Aplicación debe, a nuestro entender, utilizar las herramientas jurídicas disponibles para subsanar la incongruencia, ya que en caso de adjudicarse una licitación llamada bajo la Nueva Ley antes de su reglamentación, por lo tanto, de su entrada en vigor, tanto el proceso como el contrato serían nulos.

If you require any additional information, please contact Rodolfo G. Vouga (rgvouga@vouga.com.py), Luis Marcio Torales (lmtorales@vouga.com.py), Manuel Acevedo (macevedo@vouga.com.py), Juan Manuel Ros (jros@vouga.com.py) or your usual Vouga contact.

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[1] Tanta es la relevancia de este aspecto que la creación del SNSP constituye el objeto de la Nueva Ley (Art. 1 de la Nueva Ley).

[2] Para mayores detalles respecto a la Cadena de Suministro ver en el Art. 6 de la Nueva Ley.

[3] Para mayores detalles respecto de estos y los demás principios rectores, ver en el Art. 4 de la Nueva Ley.

[4] Art. 31 de la Nueva Ley.

[5] Art. 32 de la Nueva Ley.

[6] Aproximadamente US$ 61.378 (TC: 7250)

Nuestro Socio Rodrigo Fernández, participó junto a nuestra colega Francisca Corti de Carey Chile, en un podcast organizado por Employment Law Alliance (ELA), la red más grande de abogados especializados en temas de Derecho Laboral, en el que tuvieron la oportunidad de conversar sobre asuntos laborales de interés, qué pasó en 2022 y qué podría ser relevante en 2023.

Si desea escuchar el podcast, haga clic en el siguiente link y regístrese. Una vez registrado, recibirá un correo electrónico con un enlace y una contraseña donde encontrará el episodio de Paraguay.

Executive Summary:

Standard	Content	Date
Decree No. 8.781	The special taxable base of the Selective Consumption Tax ("ISC") for importing Type III Diesel/Oil Gas is extended until February 28, 2023.	January 31, 2023
Decree No 8.782	Until February 28, 2023, the ISC tax rates for certain electronic products are reduced by half.	January 31, 2023
General Resolution No. 124	The Undersecretariat of State for Taxation ("SET") establishes measures for the confirmation of the presentation of the receipt of registry created by General Resolution No. 90/2021.	January 09, 2023
General Resolution No. 125	SET expanded the list of goods for which tax exemption may be requested under the special regime applicable to biofuel production.	January 10, 2023

More information:

Decree No. 8781/2023 – The validity of the special ISC taxable base for the import of Type III Diesel/Oil Gas is extended until February 28, 2023.

Through Decree No. 8,676/2023, the Executive Power had established, until January 31, 2023, a special ISC taxable base for importing Type III Diesel/Oil Gas, setting it at ₲ 3,083.3 per liter. This provision is now extended until February 28, 2023, by Decree No. 8,781/2023.

Decree No. 8,676/2023 was part of the Government's practice of temporarily fixing presumptive tax bases for Type III Diesel/Oil Gas, Virgin Naphtha, and RON 91 Naphtha, whose last iteration began on February 4, 2022, with Decree No. 6,620/2022, and concluded on December 31, 2022, with Decree No. 8,416/2022.

Thus, until February 28, 2023, the taxable base for Type III Diesel/Oil Gas is determined according to the provisions of Decree No. 8,676/2023. After this date, the taxable base returns to ₲3,777.78 per liter, as provided for in Article 12 of Decree No. 3109/2019, unless the special regime is extended again.

Decree No. 8782/2023 – ISC tax rates for certain electronic products are reduced by half until February 28, 2023

Through Decree No. 8,782/2023, the Executive Power resolved to temporarily reduce by half the ISC rates for the following goods:

Product	Regular tax rates	Reduced tax rates
Automatic data-processing machines and units thereof; magnetic or optical readers, copying machines, hectographic machines, mimeographs, mimeographs, address printing machines, electrical machines, apparatus and equipment and parts thereof; sound recorders and reproducers, television reception apparatus, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus, video monitors and video projectors	1%	0,5%
Cellular telephony devices and portable terminals	1%	0,5%

This measure was taken previously, from July to December 2020, through Decree No. 3,735/2020 (published in Official Gazette No. 126, dated July 3, 2020). Therefore, if this provision is not extended, the 1% rate established for this type of product will be applied again as of March 1, 2023.

► General Resolution No. 124/2023 – The SET establishes measures to confirm the presentation of the register of vouchers created by General Resolution No. 90/2021.

The SET issued General Resolution No. 124/2023 (the "RG 124") to regulate the obligations related to the filing of the voucher registration, regulated by General Resolution No. 90/2021 (the "RG 90").

RG 124 establishes that, until June 30, 2023, failing to confirm filing the tax voucher registration stub corresponding to the fiscal year 2022 does not constitute tax non-compliance. This means that this does not generate the negative consequences of non-compliance -other than the fine for contravention-such as the impossibility of generating the tax compliance certificate, an increase of the taxpayer's risk index, etc.

This provision applies exclusively to taxpayers who must register their receipts annually (under obligation No. 956). Therefore, tax non-compliance is generated for those taxpayers who must register their receipts every month (under obligation No. 955) if they do not confirm the filing stub in due time, with the consequences already indicated.

In addition, until July 31, 2023, RG 124 exempts taxpayers who are obliged to register their vouchers on an annual or monthly basis and who confirm the filing stub late in the Marangatú Tax Management System, from the penalty of contravention. After this date, the fine for contravention foreseen for non-compliance with formal tax obligations is applied.

► General Resolution No. 125/2023 – SET expanded the list of goods for which tax exemption may be requested under the special regime applicable to biofuel production.

Through General Resolution No. 125/2023 (the "RG 125"), the SET amended General Resolution No. 112/2022 (the "RG 112"), which regulates the form of filing of the tax exemption applies for the biofuel production regime, provided for in Law No. 6,389/2019 (the "Biofuel Law").

The Biofuel Law establishes a series of exemptions applicable to producers of biofuels suitable for use in diesel engines. Mainly, these exemptions apply to the Value Added Tax ("VAT") at the time the biofuel is disposed of (which is also provided for in the general tax regime) and also at the time the producer purchases the raw materials and inputs for the production of the biofuel.

To determine what is comprised of raw materials and inputs that can benefit from the referred exemptions, RG 112 established an exclusive list of the goods included within such categories. In this sense, the SET expanded the definition of raw materials and inputs, through RG 125, by additionally adding the following products to the list:

a) Raw materials: Oils derived from all the raw materials initially mentioned (except animal fat), including soybean, sesame, tung, sunflower, corn, wheat, sorghum, cotton, peanut, canola, tartago, coconut, fodder turnip, carinata, jatropha, and safflower.

b) Inputs: Hydrochloric acid, sulfuric acid, formic acid, ethanol, paratoluene sulfonic acid and ionic resin. In addition, two more sub-categories of inputs have been added:

In addition, two more sub-categories of inputs were added:

b.1.) Consumable production supplies: filters, supplies, and additives for water treatment (salts, membranes, algaecides, and bactericides), boilers and cooling towers, supplies for stillage evaporator, supplies and additives for an effluent treatment plant.

b.2.) Laboratory supplies: Karl Fischer reagent, acetone, sulfuric ether, petroleum ether, isopropyl alcohol, PA sodium hydroxide, nitrogen, oxygen, hydrogen, helium, anhydrous methanol, certified reference materials, standard reagents, standard drugs, chromatography standards.

It is important to emphasize that raw materials and inputs that are not mentioned in the new wording of RG 125 cannot benefit from the referred tax exemptions applicable under the Biofuel Law.

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On Wednesday, February 22nd, 2023, the National Public Procurement Office (Dirección Nacional de Contrataciones Públicas) published on its website the call for bids “DIPE No. 01/2023 Prequalification of the Public Investment Project for the Expansion and Improvement of Route PY01 in the Cuatro Mojones-Quiindy Section” (ID 1288) (the "Project"). The call for bids for the Project is now open for the prequalification of interested bidders, who may download the bidding documents by accessing the following link. The deadline for submitting prequalification requests is May 31, 2023.

Once the prequalification of interested bidders is complete, the “competitive dialogue” (dialogo competitivo), will take place allowing prequalified bidders to make queries, suggestions and proposals to the contracting administration to clarify any issues they deem appropriate regarding the bidding documents. The competitive dialogue stage was introduced through Regulatory Decree No. 4183/2020 of PPP Law No. 5102/2013 with aims to speed up the clarification of the Project documents and where prequalified bidders will be able to address structuring and bankability issues.

The Project may adopt a repayment and financing structure similar to the those adopted for similar projects such as the expansion and improvement of Route PY02, which involve concession of the works.

The estimated value of the Project is approximately USD 566 million, according to data available in the Project Bank of the National Public Investment System (Sistema Nacional de Inversión Pública).

For more information on the Project or the competitive dialogue stage please visit the following links: https://vouga.com.py/gobierno-de-paraguay-aprueba-proyecto-app-de-la-ruta-py01-tramo-cuatro-mojones-quiindy/ | http://snip.hacienda.gov.py/normativas/guia_dialogo_competitivo.pdf/, or contact Rodolfo G. Vouga (rgvouga@vouga.com.py), Luis Marcio Torales (lmtorales@vouga.com.py), Juan Manuel Ros (jros@vouga.com.py) or your usual Vouga contact.  

La semana pasada la Dirección Nacional de Vigilancia Sanitaria (“DINAVISA”) comunicó a través de sus redes sociales, que estará intensificando los controles de los locales de venta de cigarrillos electrónicos, vapeadores, vaporeadores y otros sistemas de administración de nicotina y similares sin nicotina, y de las sustancias utilizadas para el uso de estos (“Vapeadores”)[1].

La Resolución Nº 153/21 de 11 de agosto de 2021 (“Resolución”) establece los requisitos para el registro de los Vapeadores ante la DINAVISA y, además, fija los requisitos para la habilitación de los establecimientos dedicados a la importación, exportación, elaboración, distribución y comercialización de los Vapeadores. Al respecto, la Ley Nº 6788/21 y la Resolución Nº 328/22[2] designan a la DINAVISA como autoridad sanitaria nacional responsable del cumplimiento de las disposiciones previstas en la Resolución y, en caso de incumplimiento, estará facultada a sancionar a los infractores.

Con respecto a los requisitos que deben cumplir las empresas y establecimientos que deseen comercializar Vepeadores, estos deberán contar con la habilitación del local de venta, estar inscriptas en DINAVISA y, una vez obtenido el registro y habilitación, cumplir con las disposiciones relativas a los lugares y puntos de venta de los Vapeadores, así como con la normativa respecto a la promoción y publicidad de los mismos. En ese sentido, es importante mencionar que podrán habilitarse únicamente aquellos locales que se encuentren habilitados como “comercializadoras” ante DINAVISA y que cumplan con los requisitos mínimos de infraestructura, tales como ser locales de venta exclusiva. Respecto a la promoción y publicidad, es importante recordar que estas actividades no están permitidas, a excepción de la realizada en los lugares y punto de venta habilitados, en cuyo caso deberá contener las advertencias sanitarias exigidas.

Hasta la fecha los controles de fiscalización realizados por DINAVISA han sido bastante laxos; sin embargo, con la entrada en vigor de la Resolución Nº 328/22, que otorga a DINAVISA un mayor grado de autonomía respecto del Ministerio de Salud Pública y Bienestar Social (MSPYBS) al tiempo que la dota de mayores recursos, tanto humanos como económicos, es posible para la institución incrementar los controles y, eventualmente, aplicar sanciones; en ese sentido, se espera que los controles con miras al cumplimiento efectivo de la Resolución intensifiquen paulatinamente a lo largo del 2023.
Las sanciones que puede aplicar DINAVISA pueden ser leves, graves o muy graves (de conformidad con lo establecido en la Resolución DNVS N° 265/22); estas van desde una amonestación, multas, decomiso y destrucción, suspensión de autorizaciones, licencia, registro o permiso, hasta la clausura temporal o definitiva del local de comercialización y la cancelación del registro sanitario.

Estaremos siguiendo de cerca los acontecimientos respecto a las tareas de fiscalización que vaya llevando a cabo la DINAVISA ya que la industria de los Vapeadores está en plena expansión en nuestro país, por lo tanto, el impacto de la medida es de alta relevancia.

Para mayor información con relación a esta operación u otros temas relacionados con Registros Sanitarios y/o Propiedad Intelectual, por favor póngase en contacto con Manuel Acevedo (macevedo@vouga.com.py), Laura Lezcano (llezcano@vouga.com.py), Stephanie Medina (smedina@vouga.com.py) y Grecia Florentín (gflorentin@vouga.com.py)

[1] Para acceder al contenido de la comunicación haz click en los siguientes enlaces:

https://www.facebook.com/104619452315666/posts/pfbid0dLXNRz4Nf2xdRPHQs3dm4f6QRm7WPDMrWueNAWUqu6zz7ecENiatxs5QZLDqDSZvl/?d=w&mibextid=qC1gEa

https://twitter.com/DINAVISApy/status/1618937479113117696

[2] Para acceder a la Resolución DINAVISA Nº 328/22 haz click aquí: https://www.mspbs.gov.py/dependencias/dnvs/adjunto/90094f-

The Executive Branch approved the public initiative project "Expansion and Improvement of Route PY01 in the Cuatro Mojones - Quiindy section" last January 30, 2023, through Decree No. 8779/23 (the "Project"). The Project was approved under Law No. 5102/2013 on Promotion of Investment in Public Infrastructure and Expansion and Improvement of Goods and Services in Charge of the State ("PPP Law").

In accordance with the PPP Law and its Regulatory Decree No. 4183/2020, the Public Private Participation Unit (Unidad de Participación Público Privada) of the Technical Office of Planning (Secretaría Técnica de Planificación) and the Ministry of Finance (Ministerio de Hacienda) approved the feasibility of the Project and it was added to the project bank of the National Public Investment System (Sistema Nacional de Inversión Pública) ("SNIP") with SNIP code No. 973, in charge of the Ministry of Public Works and Communications (Ministerio de Obras Públicas y Comunicaciones).

The Project seeks to increase capacity of and improve traffic on Route PY01, Section 4 Mojones - Quiindy, which is 108 kilometers long. Currently, Route PY01 suffers from high traffic volumes and congestion, for which the Project proposes not only to accommodate the increase in traffic estimated for the next 30 years, but also to function as an alternative route to alleviate congestion on other roads. The Project has an estimated value of Gs. 4,140,296,573,777 (USD 566,278,813)[1] and includes works and services such as:

1. Earthworks, paving, drainage and complementary works;
2. Elaboration of an environmental management plan, road safety and traffic management;
3. Bridges, viaducts and specialized services;
4. Routine maintenance;
5. Acquisition of Environmental Services Certificates (Certificados de Servicios Ambientales) (issued by the Ministry of the Environment and Sustainable Development) (Ministerio del Ambiente y Desarrollo Sostenible);
6. Preparation of bidding terms and conditions;
7. Procurement of the contract management and inspection;
8. Project management and administration; and
9. Elaboration and approval of the final design.

The public tender for bidders interested in participating in the Project will be available in the next few days on the National Office of Public Procurement (Dirección Nacional de Contrataciones Públicas) website. If you require any additional information, please contact Rodolfo G. Vouga (rgvouga@vouga.com.py), Luis Marcio Torales (lmtorales@vouga.com.py), Juan Manuel Ros (jros@vouga.com.py) or your usual Vouga Abogados contact.

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[1] Daily reference rate of the Central Bank of Paraguay: Gs. 7,311.41, effective February 1, 2023.

The Technical Office of Planning (Secretaría Técnica de Planificación – STP) approved through Resolution No. 277 dated December 23, 2022, the Guide for the presentation of Private Initiatives filed under Public-Private Participation regimes (the “Guide”).

The Guide is addressed to private sector participants as a reference for the presentation of private initiatives to be developed under PPP regimes, adjusted to meet requirements of the National Public Investment System (Sistema Nacional de Inversión Pública) (SNIP). The Guide, in accordance with Laws No. 5,102/2013 (“PPP Law”), No. 6,490/2020 (“Public Investment Law”), Regulatory Decrees No. 4,183/2020 of the PPP Law (the “Decree”) and No. 4,436/2020 of the Public Investment Law, was prepared with the purpose of providing a tool describing the process and requirements foreseen in the SNIP for all public investment projects, regardless of their modality and financing. Through the Guide, the STP makes available to all interested parties the procedure to file and propose private initiative PPP projects into the SNIP project bank, which was not previously established in the Decree.

The Guide includes the following information: (1) the documentation to be submitted on a mandatory basis, including any formalities involved; (2) project content requirements in the prefeasibility and feasibility stage; (3) processes subsequent to the reception by the STP; (4) prefeasibility level evaluation process; and (5) feasibility level evaluation process, including the process of issuance of the STP’s opinion of admission. In addition to the information set out above, the Guide includes a flow chart of the PPP project submission process, which is summarized below for practical purposes:

Executive Summary:

Standard	Content	Date
Law No. 6380	Limit for Value Added Tax ("VAT") withholding on account for local suppliers becomes effective.	September 25, 2019 (Update)
Decree No. 8612	The real estate tax values for the real estate tax and its additions, corresponding to fiscal year 2023, are fixed.	December 27, 2022
Decree No. 3108	The percentage of guarantees to be presented for the accelerated VAT refund system is fixed for 2023.	December 19, 2019 (Update)
General Resolution No. 105	The SET established the schedule of due dates for taxpayers to compulsorily adhere to the Integrated National Electronic Invoicing System ("SIFEN") - Reminder for Group 3 and following.	December 17, 2021 (Reminder)

More information:

► Law No. 6.380/2019 - Limit on VAT withholdings for local suppliers who are VAT taxpayers (UPDATE)

Law No. 6,380/2019 (the "Tax Law") introduced several short and medium-term novelties to the national tax regime, in respect of which its implementation is just beginning or is still pending. One of them was the limit of VAT withholdings on account, provided for in the first paragraph of Article 136. This limit was set at 10% of the tax stated in the sales receipt

The Tax Law provided for the application of such limit from the fourth year of its effectiveness, and because this provision came into effect on January 1, 2020, its implementation date was January 1, 2023. In other words, the application of this withholding limit was deferred from 2020 to 2023.

This decrease in the withholding percentage has great consequences for taxpayers that are VAT withholding agents since they must adjust their systems to the new limit. Among such taxpayers are the following:

► Decree No. 8.612/2022 - The real estate tax rates for the real estate tax and its additional taxes are set for the fiscal year 2023.

Through Decree No. 8,612/2022 (the "Decree"), the Executive Branch fixed the real estate tax values established by the National Cadastre Service ("SNC") of the Ministry of Finance, which will serve as the taxable base for the determination of the real estate tax and its additions for the fiscal year 2023.

The amount of the tax is determined by applying the corresponding rates (normally 1%) on the tax valuation of the real estate established by the National Cadastre Service (taxable base), which is made up as follows:

1. Urban real estate: land value (m² of the property per ₲/m²) plus building value (m² of the buildings per ₲/m²). The ₲/m² is determined by the type of street pavement (frontage) for the land value and the construction category for the buildings.
2. Rural properties: Land value (hectare ("ha") of the property per ₲/ha). The tax valuation of each district is determined according to its opportunity cost (distances to urban centers and accessibility) and the predominant type of soil according to the categories indicated in the Decree.

The tax valuation of real estate is adjusted annually according to the variation suffered by the Consumer Price Index ("CPI"), in the twelve months before November 1 of each calendar year in which such adjustment is made, as reported by the Central Bank of Paraguay. The Executive Power may make an extraordinary readjustment every five years, according to the variation in real estate value.

In that sense, the Central Bank of Paraguay informed that the variation of the CPI in the twelve months before November 1, 2022, reached 8.1%, so the Decree increased in such proportion the tax valuations for 2023. This variation can be seen for urban properties in Annex I of the Decree and rural properties in Annex II in the version of Decree No. 8736/2023.

The Decree also provides for, among other things: the valuation of properties that change from urban to rural and vice versa, the procedure for the 50% exemption for rural properties with forest priority or real right of forest surface, and the discount for rural properties with low productive areas that differ from the type of soil of their district.

► Decree No. 3,108/2019 - The percentage of guarantees to be submitted for the accelerated VAT refund regime is fixed for 2023 (UPDATE).

Article 102 of Law No. 6,380/2019 (the "Tax Law") provided that exporters and freight forwarders may request the accelerated refund of the VAT credit affected to their export or export freight operations by submitting for such purpose a bank guarantee, financial guarantee or insurance policy with a minimum validity of 90 business days from the date on which the refund request is submitted.

For the first three refund requests under the accelerated regime, the guarantee must cover 100% of the capital of the VAT credit required to SET, plus accessories. From the fourth request onwards, the guarantee must only cover the portion of the VAT credit resulting from the average percentage of rejected credits ("PCR") under the accelerated regime from January to November of the previous year, plus accessories.

To establish the value of the guarantee, the applicant must multiply the PCR by the VAT credit for which a refund is requested. The following legal accessories must be added to the resulting amount, calculated up to the guarantee's expiration date on the amount of the VAT credit resulting from the PCR: daily interest of 0.05% and late payment penalty of 12%.

SET publishes the PCR annually, and on this occasion published that it is 1.75% for 2023, to which it attached the following example of calculation for the guarantee:

Data	Securities
Amount requested:	₲1,500,000,000
Date of the request	05/01/2023
Warranty issued:	05/01/2023
Warranty expires:	18/05/2023
PCR:	1,75%

A more direct way of expressing the total coverage of the guarantee as a percentage of the VAT credit is achieved by expressing the accessories as percentages of the PCR. This is achieved by estimating the interest at 6.65% (133 days times 0.05%) and the late payment penalty at 12%, which, when added together, amount to 19.65% of the PCR, which can be rounded up to 20%. To add this percentage directly to the PCR, it must be expressed as 1.20 times the PCR, which for a PCR of 1.75% means a total guarantee of 2.1% of the VAT credit.

In those cases where the bank, financial or insurance policy guarantee is less than the amount rejected, the taxpayer must immediately pay the difference in favor of the Treasury, plus the legal accessories that will be calculated until the total payment.

General Resolution No. 105/2021 - The mandatory calendar for taxpayers to adhere to the SIFEN (REMINDER) was established.

All taxpayers, especially those in Group 3 of the SIFEN, are reminded that the SET issued General Resolution No. 105/2021 (the "RG"), dated December 17, 2021. Through this RG, the mandatory calendar for several groups of taxpayers to adhere to the SIFEN was established, foreseeing ten groups with nine different due dates, with a difference of one quarter between the dates foreseen for one group and another, except for groups 1 to 3, according to the following calendar.

Groups	Date from which they are obliged
1 – “Pilot plan”	July 01, 2022
2 – “Voluntary adherence”	July 01, 2022
3 – “Compulsory phase”	January 02, 2023
4 – “Compulsory phase”	April 03, 2023
5 – “Compulsory phase”	July 03, 2023
6 – “Compulsory phase”	October 02, 2023
7 – “Compulsory phase”	January 02, 2024
8 – “Compulsory phase”	April 01, 2024
9 – “Compulsory phase”	July 01, 2024
10 – “Compulsory phase”	October 01, 2024

Obligated taxpayers from groups 3 to 10 may start issuing electronically before the established date in case they wish to do so gradually. However, once the mandatory date arrives - January 2, 2023, for group 3 - they must exclusively issue all their documents electronically since the authorization and stamping of their pre-printed or self-printed documents, granted by the SET, will cease to be valid, except for the one related to virtual withholding receipts.

Taxpayers should take into account that they will bear the cost of the development and implementation of an electronic invoicing system, which often involves a considerable implementation time, as acknowledged by the SET in article 4 of the RG when it grants a period of up to 12 months of adaptation to those who wish to become voluntary electronic billers.

Therefore, it is extremely important to be aware of whether you or your company is covered by the mandatory SIFEN, because, if you are and you do not take the appropriate measures in time, you may no longer be able to operate normally. If you want to know if you or your organization are affected by this RG, you can consult the complete list of taxpayers in the complete list of taxpayers in the following search engine. For further details or better advice, don't hesitate to get in touch with our tax professionals.

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