The Argentine General Directorate of Customs (DGA) detected an evasion of almost USD30 million in the export of dog food, caused by a jump in tariff heading between 2011 and 2015, it reported this Wednesday (28.09.2022) in a statement.
According to the official source, specialized agents from the DGA-AFIP took samples of merchandise that was being exported as balanced dog food and concluded that it was composed of 90% soy flour and 10% ground corn and added carbonates.
“Through this maneuver, companies They were paying 5% in export duties, instead of the 35% that applies to flour," The DGA stated that "in this way, the different companies enjoyed lower tariff treatment and less rigorous prior interventions than those to which they should, strictly speaking, be subject."
To carry out the investigation, Customs relied on the leading case of the company Finning Argentina SA, after which it discovered that this type of maneuvers had spread to other companies in the sector and applied a massive adjustment.
Following the Customs complaint, most companies in the sector appealed to the National Tax Court (TFN), which recently issued its first precedent in the case “Food and Forage SA v. DGA s/Appeal”, in which he ratified the position of the organization headed by Guillermo Michel.
The appellate court stated: “The Analysis Protocol is clear that the samples taken consist of 100% plant structures, with a proportion of defatted soy flour of over 96% and ground corn of 4%, where no carbonates are detected and the existence of sodium chloride is positively identified. The latter does not change the proportion of plant structures in the 100% composition described.”
Apparently, the jurisprudence established by this ruling would apply to another 38 lawsuits filed by exporting companies in the sector, amounting to a total of approximately USD 28,5 million in taxes and 198 million pesos in fines.
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