Tax credit and tax reorganization

Abstract

The determination of the legal nature of the tax credit generated by VAT has a significant impact on companies that face business reorganization processes, given that there is controversy over whether this tax credit should be considered a very personal right or property right. In the context of business reorganizations, such as conversion of individual companies, division and merger of companies, the question arises as to whether it is possible to use this tax credit by the continuing companies, which acquire the assets and liabilities. This gives rise to the importance of finding solutions to the indeterminacy of the legal nature of the tax credit
to avoid its loss and unusability, in line with the protection of the principles of tax justice1, fair distribution of taxes, the good faith of the tax-payer, and the need for tax equity for both taxpayers and the State.