Decree No. 6.815/1969
Standards for determining the tax obligation on the part of holders of permits for exploration or concession of hydrocarbon exploitation.
Bs. As., 20/10/69
VISTO Article 56 of the Hydrocarbons Act No. 17.319; and
That it is necessary to dictate the interpretative rules of the various aspects that will constitute the determination of the tax obligation by the holders of permits of exploitation or concession of exploitation;
THE PRESIDENT OF THE ARGENTINA NATION
Article 1- The determination of the net profit subject to the special income tax shall be carried out in accordance with the provisions of article 55° and concordants of Law No. 17.319 and those contained in the present decree, supplementary and additionally shall apply, as appropriate, the rules of the tax on revenues in the current text as at 30 June 1967, their regulations and concordant provisions.
Art. 2°- The activity concerning each permit or concession shall be subject to a separate declaration in which the owner or operator holder in the case that is more than one, shall report annually in the form or term fixed by the General Tax Directorate, on the following aspects concerning the period considered:
(a) Investment, amortization and expenditure;
(b) Tributes whose deduction is permitted under Article 56 (c) of the Law;
(c) Hydrocarbons extracted
The information indicated above shall refer to the entire area and the share corresponding to each of the holders of the permit or concession.
The option that, with reference to direct operating expenses and amortizations, relating to the first period of the base period, establishes paragraph IV of article 56 (c) of the law, may be exercised by each of the holders until the time the affidavit is submitted for the period in which the concession is obtained or, if not until the last period covered by the basic period of the exploration permit. If you opt for the simple deduction against any type of Argentine source income, this will be done in the exercise in which the option is manifested.
Art. 3°- Each person or concessionaire, in turn, shall submit to the Directorate-General of Impositive in the form and time provided by the Directorate-General an annual affidavit of all the results obtained in the permits or concessions in which it participates. Such a declaration computed to compensate the benefits and breaches resulting from each permit or concession, taking into account, where appropriate, the different taxes that may encumber the activity concerning a house permit or concession, in accordance with article 103 of Law No. 17.319, on the basis indicated, the special tax shall be liquidated and paid, subject to the calculation of the participation in the payment of the taxes mentioned in the preceding paragraph.
Art. 4°- When in one year the concessionaire suffers loss or obtains any tax balances on his behalf, determined by the liquidation made pursuant to Article 3, he or she may deduct them, respectively, from the encumbered profits or the tax to pay in the following immediate years.
After ten (10) years after that in which the loss occurred or the tax balance was originated under the application of the different liquors referred to in article 103 of Law No. 17.319, it shall not be able to deduct any of the oath or balance of the tax remaining, the tax balances in favour of the taxpayer that do not come from the application of the different liquables, except for the subsequent errors (25
Art. 5°- The accruals of the exercise are considered, a provision that will be applied by analogy for the charge of the expenses. The exercises should be annual. In the event that the activity is carried out jointly by two or more permisionaries or concessionaires, the financial period shall coincide with that of the permisionary or concessionaire responsible for the administration of the activity concerning the respective permit or concession.
Where special circumstances warrant, the Impositive General Directorate may admit or dispose of the tax based on non-year periods or authorize other closing dates.
Art. 6°- For the purpose of determining the net fiscal utility, the stocks of hydrocarbons extracted at the end of the exercise will be taken into account, evaluating them according to the methods authorized by the law of tax on revenues. Adopted a valuation method may not be varied, for the respective permission or concession, without prior authorization from the Tax General Directorate.
Art. 7°- The existence of the economic link referred to in subparagraph (e) of article 56 of the law shall be presumed when the holders of the permit or concession make their sales or deliveries of the product between themselves, or through persons or societies that can economically be considered to be linked to those on the basis of the origin of their capitals or the effective direction of the activities, or of the agreed prices, or the distribution of profits, or of any other indications. In these cases the price of the product will be fixed in the current heat of the same in the domestic market the time to dispose, transfer to any title or industrialize.
Art. 8°- Faculty to the enforcement authority of Law 17.319 to establish hydrocarbon prices, shall be computed for the purpose of the liquidation of this tax.
Art. 9°- The results from the realization of assets of the asset affected the activity of exploitation or exploitation of hydrocarbon deposits should be computed for the purpose of the liquidation of this tax.
Art. 10- In the event of obtaining the permit or concession by assignment, they shall be applicable for the purposes of valuation of goods, rules on sales, transfers of trade funds, etc., established in the law of taxation and its regulation. The benefits or breaches that originate in the assignment of one or more areas shall be computed by the assignor for the purposes of the liquidation of the tax the revenues, therefore being subject to the provisions of the respective rules.
Art. 11- Where the assignees or concessionaires develop other activities in addition to those covered by Article 56 of the Act, they shall be accounted for separately to allow their control and analysis.
If there are expenses and investments common to different activities, they must be charged to each of them according to their actual and real impact. In the event that there is no evidence to allow for this procedure, they will be distributed according to investments made in each activity.
The Impositive General Directorate may admit other forms of distribution when they better adjust the real economic situation.
Art. 12- Where the assignees or concessionaires referred to in Article 11 distribute dividends or profits, determine that the profits included them, and must enter the levy established by the law of tax on the portion of the amounts distributed to beneficiaries of the outside integrated with profits not covered by the provisions of Article 56 of Law No. 17.319.
The same criterion shall apply the establishments organized in the country in the form of a stable company, belonging to companies of capital, regardless of their denomination, constituted abroad, when they turn or credit utilities to such entities.
Art. 13- Expenditure and investments made for the exploration and exploitation of hydrocarbons that had contributed to the discovery of minerals not covered by the law may be fully charged with the liquidation of the special tax. However, from the moment the exploitation or exploitation of such mineral substances begins, it will be at what Article 11 provides.
Art. 14- The deductions referred to in article 56 (c) (c) of the Act shall be made up of all direct expenses, accepted as such by the General Impositive Directorate, produced by the development of the exploitation activity during the first period of the basic period of the corresponding permit.
Art. 15- The cost of amortizations referred to in paragraph II of article 56 (c) of the Act shall be composed of amounts effectively invested in direct exploration expenses during the first period of the basic period of the corresponding permit. This cost does not integrate investments in machines, equipment and other fixed assets, or their amortizations.
Art. 16- Obtaining the concession of exploitation, direct costs incurred in the drilling, within the area of each well, and deductible investments affect them, will have the following fiscal treatment:
(a) If the well is not exploitable, the amount of the invested and spent on it will be distributed among the exploitable wells, depending on the amounts invested and spent on each of these and on the exercise in which such a circumstance is verified, or it will be deducted entirely in that exercise to the option of the person responsible;
(b) If the well is exploitable, the value of the invested and spent on it shall, if any, be added to the corresponding amount in the assessment provided for in the preceding subparagraph (a). The total amount resulting for each well will be divided by the total cubic meters of hydrocarbons that is calculated to extract from it within ten (10) years, or in the period that still remains until the expiration of the concession, which is less, thus establishing the deductible value per cubic meter extracted in each fiscal year. If, after the determination of the amount deducted by cubic metre of hydrocarbons, the calculation of production is not correct, the relevant adjustment must be applied, which will be applied for the future. In no case shall the total deductions for the concepts in question exceed the amount to which the same amount may amount, for the purpose of determining the deductible amounts in each exercise, the weighted average unit value for all wells may be established and applied to all production.
Article 17 The exemption set forth in article 56 (d) of the Act extends to all national taxes present or future, on profits, capitals affected to the activity or which seriously undermine the activity itself or acts associated with it, including seal tax, with the sole exception of those expressly excluded in the same subparagraph and in subparagraph (b) of the article.
In the case of companies that, in order to develop other activities, tax on the capital affected to them the substitute tax on the free transmission of goods, the common asset heats will be assessed on the basis of the values of the assets affected to each activity. For these purposes, active assets, including the computation of deferred charges, attributable to the activity carried out under the Act No. 17.319, shall be evaluated in accordance with the rules provided for in the law and the regulations of the aforementioned tax.
Art. 18- The Impositive General Direction will set the dates of liquidation and payment of the special tax to the rent.
Art. 19- This decree will be endorsed by the Minister of Economy and Labour and signed by the Secretary of State for Energy and Mining and Finance.
Art. 20- Contact, post, give to the National Directorate of the Official Register and archvese.
José M. Dagnino Pastore
Luis M. Gotelli
Luis B. Mey