The bill seeks to grant CEEC to properties for which a building permit has been requested before April 30, 2023 and postpone the elimination of the benefit to 2027, including a new transitory stage.
Last Tuesday, March 21st, the Senate approved the bill that “Modifies various regulatory bodies to adapt them to the emergency housing plan and facilitate the execution of urban works.”
The law project seeks to provide incentives and simplify the carrying out of urban works within the framework of the Housing Emergency Plan promoted by the government.
The bill was sent to the Chamber of Deputies in order to approve some modifications introduced by the Senate. In short, if these modifications are approved, the CEEC regime would be as follows:
• Complete CEEC
Construction companies will have the right to deduct from their Monthly Provisional Income Tax Payments 65% of the VAT debit with respect to affected sales and construction contracts, and 12.35% of the value of VAT-exempt sales for having MINVU subsidies, when they have requested a building permit for the respective property prior to April 30th, 2023.
The benefit should be maintained regardless of the start of the works and the date of sale of the respective units.
• First transitory stage
As of January 1st, 2023, construction companies may deduct 32.5% of the VAT debit with respect to sales and affected construction contracts, provided they have obtained the municipal building permit and the works have started before January 1st, 2025.
Likewise, they may deduct 6.175% of the value of VAT-exempt sales for having MINVU subsidies, made from January 1st, 2023 to December 31st, 2024.
• Second transitory stage
As of January 1st, 2025, construction companies may deduct 16.25% of the VAT debit with respect to sales and affected construction contracts provided they have obtained the municipal building permit and the works have started before January 1st, 2027.
Likewise, they may deduct 3.0875% of the value of VAT-exempt sales for having MINVU subsidies, made from January 1st, 2025 to December 31st, 2026.
• Elimination of CEEC
The benefit will be removed as of January 1st, 2027.
For more information, review the processing of the project at this link.