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News article4 September 2023European Innovation Council and SMEs Executive Agency1 min read

Income generated through the utilization of IP is exempt from the IRAE tax in Uruguay

Uruguay's Free Trade Zones (FTZs) offer various benefits to businesses and investors. These zones are designed to attract foreign investment, promote economic growth, and facilitate international trade.

In order to draw attention from foreign investors, Uruguay has set several incentives for companies to benefit from when setting up operations in these areas. One of the most significant incentives offered is a favourable tax regime. Businesses and individuals operating within FTZs in Uruguay enjoy various tax incentives, including exemptions from Tax on the Rents and Activities in Uruguay (IRAE), Value Added Tax (VAT), and other national taxes for a specified period, which can extend up to 30 years.

In Uruguay, income derived from the use of intellectual property and other intangible assets are also exempt from IRAE, encouraging knowledge-based industries to establish operations within the FTZs.

The exemption can be particularly attractive to companies engaged in activities such as research and development, technology transfer, and other knowledge-based industries. It provides a favourable tax environment for companies looking to protect and commercialize their intellectual property within Uruguay's FTZs.



Publication date
4 September 2023
European Innovation Council and SMEs Executive Agency