El Salvador: Free trade zones, call centers and other taxpayers exempted from the special contribution for large taxpayers must calculate and pay this tax with respect to the period from january to july 2019

Written by:

William Escobar


The Ministry of Finance has published on its website the new orientation guide (DG 01/2020), with the “Guidelines to facilitate the application of the Special Contribution to Major Taxpayers for the Citizen Security Plan“, which is in force since 29 April 2020.


Among the most relevant aspects set forth in this tax guide is the guideline that those subjects exempted from the referred special contribution, such as Free Zone Users, DPAs, Call Centers, among others, must calculate their net income until July 5, 2019 (information recorded in the accounting books at that date), and apply five percent (5%) of the special contribution.


The above, as explained in the aforementioned tax guide, is due to the fact that the reform establishing the aforementioned exemption was carried out by means of Legislative Decree No. 324, published in the Official Gazette No. 93, Volume No. 423, corresponding to May 23, 2019, which entered into force on July 6, 2019. Therefore, these exempted parties must pay the special contribution, calculating the net income until July 5, 2019. 


It should be taken into account that the aforementioned special contribution must be declared and paid until June 30, 2020, in accordance with the provisions of the “Special Transitional Law to Facilitate the Presentation and Payment of Income Tax, Advance Income Tax and other Formal Obligations, in the Framework of the COVID-19 Emergency”.


Likewise, it is recalled that the validity of the Special Contribution to Large Taxpayers for the Citizen Security Plan (CEGC) ends this tax year 2020, unless it is extended by means of legal reform.


To learn about the contents of the Tax Guidance Guide DG 01/2020 dated April 29, 2020, you may access the website of the Ministry of Finance, or through the following link: https://www.mh.gob.sv/downloads/pdf/700-DGII-GA-2020-22108.pdf


For any additional questions, please contact Dr. Diego Martín (dmartin@consortiumlegal.com) and/or Mr. William Escobar (wescobar@consortiumlegal.com ).  

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