Amendment to the general anti-avoidance rule (“GAAR”)

Anti-avoidance Commission and administrative procedure
  • An Anti-Avoidance Commission is created for assessing conducts that may qualify as elusive, in accordance to the GAAR. The Anti-Avoidance Commission acts upon request of a special committee of the IRS created for this purposes.
  • In order for the IRS to apply the GAAR, a new administrative procedure is regulated.
General aspects
  • Fine cap to tax advisors is increased up to 250 Annual Tax Units (approx. US$210,000).
  • Mention to the principle of good faith of taxpayers is removed.
  • Free exercise of options is extended to alternatives set forth not just in the tax legislation, but in the whole legal system.
  • GAAR are applicable to business restructuring operations, notwithstanding the existence of a special control rule.
  • Establishes and regulates the concept of artificial conducts for purposes of the GAAR application.
Jaime Carey
Managing Partner
+56 2 2928 2224

Jessica Power
+56 2 2928 2226

Manuel Alcalde
+56 2 2928 2226

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