The Supreme Court of Justice announced on April 10 a series of rulings declaring the unconstitutionality of certain provincial regimes for the Gross Income Tax. The decisions concern regulations that imposed higher tax rates on companies without local production facilities, affecting the provinces of Jujuy, Santa Fe, and Entre Ríos.
The court ruled in favor of several companies, finding that these norms violated the principle of equality and hindered interprovincial trade, which is protected by the National Constitution.
The judgments establish that provinces cannot set different tax rates based on where goods are produced. The main issue was whether laws imposing higher rates on businesses operating outside a province’s territory were valid. According to the court, this system resulted in discrimination not allowed under constitutional rules against internal customs barriers. The judges said such regulations disrupt normal trade between jurisdictions and impact how the domestic market functions.
In Jujuy’s case specifically, the Supreme Court examined laws setting higher taxes for industrial activities conducted outside provincial borders. Similar situations were reviewed in Santa Fe and Entre Ríos, where firms without local establishments faced increased or progressive charges.
In all instances, the judiciary concluded that using production location as a basis for varying tax burdens is unconstitutional. These rulings create clear limits for provincial fiscal strategies aimed at encouraging industrial investment through punitive taxes on external producers.
For businesses, this could mean less uncertainty and potentially lower costs for industries with operations spread across regions. For provinces, it raises questions about future revenue models and may lead to further legal challenges or changes to their fiscal codes.
