Tax and labour Uruguay

Labour & tax changes Covid-19


1.           LABOUR


By means of Resolution 163/020 of 20/03, the MTSS extended to all sectors of activity the flexibility of the partial unemployment subsidy resolved by Resolution 143/020 dated 18/03.

Through these resolutions they are covered by the benefit:

  • Those workers in a situation of partial suspension due to a reduction in the number of monthly working days with a minimum of 6 days in the month.
  • Those workers with total reduction of hours from their usual schedule by a percentage of 50% or more than the legal or usual in normal times.

The application for the BPS subsidy will be made in the last month. For example, you decide to send a worker from 20/03 to 31/03, the data to BPS will be entered on 01/04.


Through Resolution 55/020, the MTSS authorizes the advance of leave to be generated in the year 2020 as long as it is agreed between the worker and the employer and is motivated by the health emergency situation.

The aforementioned agreement must be in writing and registered with the MTSS.

It is worth mentioning that the paid leave and the corresponding vacation salary must be paid in the form and at the time established by the regulations in force. In any case may the number of days to be enjoyed being less than 10.


The Article 6 of Decree 94/20 encourages companies to implement remote work. This situation must be reported to the General Labour Inspectorate.

The employer must provide the necessary implements to carry out the task.


By Resolution of the MEF the dispositions that oblige the user companies of Free Zones to carry out their activity from free territory were made more flexible; allowing the remote work of the staff. This resolution will be in force until April 10 and must be reported to the Directorate General of Trade and the MEF.


By Decree 109/020 of 25 March, private sector workers aged 65 or over may be placed in isolation for a maximum period of 30 days and are entitled to receive the common sickness subsidy for the duration of the isolation.

Those who regularly work from their homes are excluded from this provision.

Workers covered by this scheme must be notified by the employer.


The Bill of 24/03/2020 establishes exemptions and payment facilities, which will be applied automatically, without the companies carrying out any management, for the payment of the employer’s and non-dependent worker’s contributions for the activities carried out in the months of March and April, which must be paid in April and May.

Holders Understood:

The holders of companies of Industry and Commerce with up to 10 dependent workers, including in this condition those who are covered by the subsidies provided by BPS and BSE, being also covered the holders of mono-taxes and social mono-taxes Mides and the companies with the following legal natures:

  • Single person (holder and spouse)
  • De facto company
  • Limited liability company
  • Partnership
  • Limited partnership
  • Capital company
  • Limited partnership by shares
  • Agricultural company of limited responsibility

A bonus of 40% of the total personal and employer contributions of non-dependent workers is set.

The remaining 60% is financed in six interest-free instalments, with the first instalment to be paid in June 2020.

The bonus and financing of contributions is applied to employer and personal contributions calculated on the fictitious amounts or actual remuneration declared by non-dependent workers.


By means of Resolution 54/020 and Resolution 52/020 of the MTSS establish control and prevention measures in the work environment to avoid the spread of COVID-19.

These include publication of information on COVID-19, hygiene measures, not sharing personal items, and having mechanisms for action in the event of the appearance of a worker with symptoms of the disease.


The Bill 24/03/2020 establishes that the disease COVID-19 will be considered an occupational disease, for the health personnel that participates directly or indirectly in the assistance process (doctors and non-doctors) and are exposed to SARS-CoV2 causing the disease COVID-19. Such consideration shall be during the time covered by the health emergency declared by the Executive Branch.

2.           TAX CHANGES


Decree 97/020 repealed the additional reduction of 2 percentage points of the VAT rate on the disposal of goods and services whose total amount was less than UI 4,000, including VAT, provided that the consideration was made in a single payment using debit cards, electronic money instruments or similar instruments.

By the same decree, VAT refunds are reduced from 9 to 5 points for purchases by final consumers using credit cards, debit cards, electronic money instruments or similar instruments, for gastronomic services (restaurants, bars, canteens, etc.), services for parties and events, car rental without a driver, mediation service for the rental of property for tourism purposes.


Decree 88/020 grants beef and sheep producers who do not pay income tax on economic activities (IRAE) for these productive activities, a refund of the value added tax (VAT) included in their purchases of diesel for the development of these activities.

This regime will be applicable to those acquisitions made from 1 March 2020 and for a period of 1 year. The maximum limit of the benefit referred to in the previous article may not exceed 0.4% of the income originating from the sale of cattle and sheep, corresponding to the last fiscal year closed before July 1, 2019.

On the other hand, Decree 89/020 grants milk, rice, flower, fruit and vegetable producers, and beekeepers, who do not pay Income Tax on Economic Activities (IRAE) for the referred productive activities, the refund of the Value Added Tax (VAT) included in their purchases of diesel oil intended for the development of the same.

This regime will be applicable to those acquisitions made from 1 March 2020, for a period of 1 year. The maximum limit of the benefit referred to in the previous article shall be determined by applying the percentages that vary between 1.1% and 4% depending on the product sold to the income originated in the sales of each of the agricultural products, corresponding to the last fiscal year closed before 1 July 2019.


Through DGI Resolution 550/2020 of 20 March 2020, the DGI extended the deadlines established between 23 and 26 March 2020 to 27 March 2020.

It also establishes that taxpayers covered by Article 52(E) of Title 4 (small enterprises) may pay their obligations for the months of February and March 2020, in six equal and consecutive instalments as from May 2020. This includes the instalments corresponding to payment facilities, due in the months of March and April.


The Bill 31/03/2020 creates the “Solidarity Fund COVID-19”, destined to exclusively attend the expenditures coming from the sanitary emergency by COVID-19 (expenditures of the Ministry of Public Health, the National Emergency System, the Social Security Bank and state activities destined to the attention of the population).

The fund will be financed with profits from the Banco de la República Oriental del Uruguay, Corporación Nacional para el Desarrollo, donations, loans from international and multilateral organizations, and by transitory taxes created by the law itself (Impuesto Emergencia Sanitaria COVID-19).

Emergency Healthcare Tax COVID-19

This tax will be levied on the nominal remuneration and benefits, in cash or in kind, derived from personal services, whatever the legal nature of the relationship of dependence, provided to the State, Departmental Governments, Autonomous Bodies and Decentralised Services, corresponding to the months accrued in April and May 2020 (and can be extended for a maximum period of three months).

They are taxed according to the following scale of proportional rates:

Holiday bonuses and salaries are excluded from this tax.

The tax also covers individuals who have personal service contracts with the State, including contracts for the lease of works or services, which are motivated by temporary ties that do not have the status of public officials. Those who receive subsidies granted by law to those who have occupied public or particularly trusted positions must also pay the tax.

The tax does not apply to health care personnel who participate directly or indirectly in the care process (medical and non-medical) and who, as a result of the tasks they perform, are exposed to SARS-CoV2 infection, which causes COVID19.

The salaries and nominal benefits of the President and Vice President of the Republic, Legislators, Ministers and Under-Secretaries of State, Quartermasters and other political officials and those of particular confidence shall be taxed by this tax at the rate of 20%. For the Mass rate, the subsidies established in Article 35, Section C, Subsections 3 and 4 of Institutional Act No. 9 are reached.

In any case shall the amount of the liquid remuneration and benefits, once the special contributions to social security, the contribution to the corresponding health system, the Labor Reconversion Fund, the Income Tax of Individuals and the tax that is created, be less than the greater of the following figures:

  • $ 80.000
  • The liquid resulting from the higher income of the previous band according to the liquidation of an individual without dependents or other relatives, which is liquidated under the individual regime for the purposes of Personal Income Tax and the corresponding health system.

The tax also covers income corresponding to retirements, pensions and similar benefits of passivity, served by public and private institutions, resident in the Republic, according to the following scale:

In any case shall the amount of the pensions or similar liquid liabilities, once the contribution to the corresponding health system, the Social Security Assistance Tax and the Tax that is created, be less than the greater of the following amounts:

  • $ 80.000
  • The liquid resulting from the higher income of the previous band according to the liquidation of an individual without dependents or other relatives for the purpose of contributions to the corresponding health system.

Alexandra Weisz, Auren Uruguay

[email protected]