Paraguay Tax Agency Releases Binding Consultation Clarifying VAT Exemption for Securities Repo Operations

The Paraguayan National Tax Revenue Directorate July 2 issued Binding Consultation No. 541, clarifying VAT exemptions for securities repo operations. The taxpayer, a bank, inquired whether a VAT exemption under Law No. 6380/2019 applied to the repos it carried out for sale/buybacks of securities. The Tax Agency responded that: 1) the exemption applies to disposals of public and private securities, including shares or quotas of companies carried out through repo operations; 2) this exempt treatment applies to repos carried out in the securities markets or directly with third parties, and to vertical, horizontal, and tripartite repos carried out through the ...