Administration Analysis
Report No. 000076-2023-SUNAT/7T0000, published on June 16, 2023, presents the analysis regarding the qualification of the disposal of shares derived from a merger between non-domiciled parties.
The consultation presents the assumption of a Holding Company “A” that absorbs another Holding Company “B” through a merger process, both incorporated abroad, the latter being the indirect owner of a company incorporated in Peru (Company “C”). The question is whether this situation qualifies as an indirect disposal of shares of Company “C,” according to section e) of Article 10 of the Income Tax Law.
SUNAT concludes that despite there being no issuance of shares for the shareholders of the absorbed company, this does not determine that the transfer of valuable consideration of the shares of the equity of the absorbed company due to the merger ceases to occur. Therefore, the assumption consulted does generate an indirect disposal of the shares representing the capital stock of Company “C.”
Challenges of this Interpretation
The same criterion was expressed in Report No. 000087-2022-SUNAT/7T0000, which considers a reverse merger abroad, which, as in the case under consultation, affected the capital stock of a Peruvian company by having the absorbed company as a shareholder.
Conversely, the criterion of the Administration included in both reports, although based on the current legislation, does not observe that such mergers are a reorganization of companies, which does not benefit specifically due to the absence of a change of control.
In this regard, due to the absence of a capital gain by the Peruvian company, the levy of these transactions only increases the costs. This has great implications for Peruvian investment, making it an unattractive market for foreign companies.
Bill No. 843/2011-CR
In this regard, the frustrated Bill No. 843/2011-CR, which proposed an amendment to section e) of Article 10 of the Income Tax Law, was presented. This consisted of implementing a levy exemption for direct or indirect transfers of shares among companies of the same corporate group. Despite the innovative proposal, it was rejected, and the current legislation allows the determination of the indirect disposal of shares as a taxable event.
Source: SUNAT 14/03/24