On 14 September 2007, the Senate approved the tax reform submitted by the government to the Congress on 20 June 2007. The most significant aspect of the reform is the creation of a "business flat rate tax” (Impuesto Empresarial a Tasa Unica – IETU) of 16.5%. The IETU Law will enter into force as of 1 January 2008.
IETU was structured to moderate tax benefits of certain deductions and to prevent evasion and certain abusive practices. IETU has also been d…