Uruguay woos business investors, wealthy with tax residency rule change

Uruguayan President Luis Lacalle Pou has eased tax residency rules, after previously indicating that he would work to attract wealthy individuals to Uruguay as part of efforts to spur investment.

The changes, outlined in a decree, make it cheaper for individuals to qualify for tax residency from July 1.

Under the amended framework, individuals who acquire real estate for more than 3.5mn UI (accounting units, about US$378,000) and also stay in the country for at least 60 days a year are eligible. The current minimum is 15 UI and 183 days.

Investing, directly or indirectly, more than 15mn UI in a business that generates 15 or more jobs also opens the door. The current minimum is 45mn UI.

Lacalle Pou (pictured) is also preparing to submit a bill containing associated tax measures, local paper El Observador reported.

The government recently unveiled a sweeping reform bill to help spur the economy, which was underperforming prior to the health crisis and is now expected to shrink 3.7% this year, according to World Bank estimates.