Uruguay is home to 12 free trade zones in total. Within these zones, all forms of business activities are permitted: from manufacturing and warehousing, to services and trade. As such, these special economic areas play a key role in attracting foreign investment to Uruguay.
Well-known companies such as PepsiCo and Sony base operations within two of Uruguay’s zones and, as such, have profited greatly over the last decade.
Despite private ownership, all zones are monitored by the Free Zone Area which reports to the General Trade Bureau of the Ministry of Economy and Finance.
Investing in Uruguay’s Free Zones is beneficial to both individual businesses and the national economy. FTZs attract massive foreign investment, generating capital through jobs and spending and businesses get a tax break. A company’s tax burden can be the difference between turning a profit on a years’ worth of business or making a loss.
Using a tax relief to re-invested into the improvements and growth of your business offers companies the chance to grow like no others.
Tax exemptions are probably the most beneficial part of operating from an FTZ. Operators working in these zones are exempted from all national taxes except social security for their employees unless deliberately waived by the employee.
Customs duties exemptions
As well as being exempt from national taxes, goods and services coming in and out of the zones are also exempt from any custom tax. Even when transferring goods and services to and from other FTZs, they are exempt from any Value Added Tax. Imports and exports from a non-free zone, however, do incur taxes but only to be paid by the non-free zone agent.
The trade of foreign currency, gold, and other precious metals is completely tax-free. No commercial transactions or forms of payment go through or are interfered with by any economic authority not even by Central Bank.
Quick setup time
Although relatively longer than the normal company incorporation process in Uruguay, to set up a business within a Free Trade Zone only takes 9 weeks.
Compared with other FTZs worldwide, this is a highly competitive time frame for company formation.