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Entrepreneurs: which country offers better benefits to expand your business and make it more profitable

2023-05-24T09:40:42.117Z

Highlights: There is a place nearby that offers many economic, legislative and fiscal advantages for Argentines. For an Argentine company with a functioning S.R.L it is a great benefit to open a branch in Chile. Since 2015, 97.2% of Chilean goods (7,336 product categories) can enter the Chinese market duty-free. And, in return, most products produced in China can enter Chile duty free. The most favorable businesses with the greatest advantages are those related to the technological and textile industry.


There is a place nearby that offers many economic, legislative and fiscal advantages for Argentines. Which one.


For some time, Chile has once again been an attractive and convenient destination for Argentines who want to buy clothes and technology but in addition, there are some factors by which it can be attributed the wide price gap in the same products purchased in one country or another.

It is these same factors that also provide a perfect scenario for Argentine companies that wish to expand into the international market. And it is that the alternative of being based in Chile allows to obtain legislative, fiscal benefits and take advantage of the numerous international treaties and conventions that the neighboring country maintains with China.


Compared to other countries, registering a company in the neighboring country is one of the safest options, because it is a prosperous and stable nation in South America, which attracts investors for its political and financial transparency within the region.


For an Argentine company with a functioning S.R.L it is a great benefit to open a branch in Chile. Photo Shutterstock.

Why is it easy to expand the business to Chile and what are the benefits?

Although companies in any field can find opportunities for improvement in the neighboring country, the most favorable and with greater advantages are those related to the technological and textile industry. Why is that?

. Legislative similarity between Argentina and Chile

In the first instance, it is worth noting the great legislative similarity between Chile and Argentina because both have as a corporate figure the Limited Liability Company (S.R.L) and as in our country, a minimum of two partners and a maximum of 50 whose liability is limited to the capital contributed is required for its constitution. There is also no minimum capital required by law.


In this context, lawyer Melissa Zanoni, also responsible for legal at Argentapp, a platform specialized in business and immigration processes in Latin America and Europe, told Clarín that "these reasons make the SRL become one of the best options when starting a business in Chile regardless of the size or size of the company."

. Bilateral Agreement between both countries

The lawyer explained that if it is an Argentine company, already established at the national level with an SRL in operation, the most advisable thing is the constitution of a permanent agency in Chile.

"In this way, the nuance house would be preserved within the national territory, and it would expand to the neighboring country through an agency or branch. Which, as a result of the bilateral agreement between both countries to avoid double taxation, allows taxes to be paid only in the country where the company establishes its parent company, "said Zanoni.

Chile offers a stable environment due to controlled inflation. Photo: Shutterstock.

. Stable economy and controlled inflation

From the fiscal perspective, Chile offers a stable environment in terms of its innovation and economic environment due to controlled inflation with practically little monetary devaluation. Reasons that are extremely beneficial and attractive to foreign investors.

In this line, the lawyer stressed that in Chile they offer large tax revenues since those companies based in the country that are considered MSMEs (micro small and medium enterprises) can opt for the deduction of income taxes for reinvestment in working capital or fixed assets.

They also have access to a reduced corporate tax rate that is currently 25%, but there is a bill in Congress to reduce that percentage to 10%.

Although, according to Zanoni, foreign shareholders have to pay an additional tax of 35%, once the profits are distributed at the end of the year it can be subsidized in its entirety as a credit to all taxes paid in Argentina, to avoid double taxation between both countries.

The most favorable businesses with the greatest advantages are those related to the technological and textile industry. Photo: Archive

. International treaties between Chile and China

Finally, it is important to highlight the international treaties between Chile and China, which consist of the fact that, since 2015, 97.2% of Chilean goods (7,336 product categories) can enter the Chinese market duty-free. And, in return, most products produced in China can enter Chile duty-free.


For these reasons it is that Chile is a great opportunity for those Argentine companies that want to consolidate in the Asian and European market enjoying the great benefits at the legislative, fiscal and international relations level and being so close to our country.

LN

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Source: clarin

All news articles on 2023-05-24

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