Taxation is the main source of revenue for the Peruvian government (up to 76%). For 2016, projected tax revenues were $94.6 billion ($29 billion). There are four taxes that account for about 90% of tax revenues: Peru has agreements with Brazil, Canada, Chile, Korea, Mexico, Portugal and Switzerland on double taxation of income tax under the Organisation for Economic Co-operation and Development (OECD) model. In addition, Peru has concluded a double taxation agreement (DTT) with Japan, but it is still about to be ratified by the Peruvian Congress. In addition, Peru, as a member of the Andean Community of Nations (ACN), which includes Bolivia, Colombia and Ecuador, is subject to a double taxation standard (based on source income and not the OECD model). Peru is also a member of the Andean Community, along with Colombia, Ecuador and Bolivia. In that regard, Decision No 578 applies to the prevention of double taxation between the Member States of the Andean Community and to the prevention of tax evasion. Decision No. 578 gives priority to withholding tax according to the exemption method.  To avoid double taxation of income tax, Peru has concluded agreements with Brazil, Canada, Chile, Korea, Mexico, Portugal and Switzerland on the model of the Organisation for Economic Co-operation and Development (OECD).  The tax administration has recently published a list of assumptions that could include the application of gaar. These include: (i) the deduction of licence fees for assignment when using trademarks; (ii) the alienation of a Peruvian entity by an autonomous inheritance; and (iii) the re-domiciliation of an enterprise to make use of a double taxation avoidance agreement (DTT). Scheme: working conditions are agreed directly between employees and employers.
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