In Executive Decree 617 published on December 20, 2018 we find the standard definition of transparency and economic substance: in article 6 of the Regulations for the Application of the Organic Law for Productive Development, Attraction of Investments, Employment Generation, and Stability and Fiscal Balance it is indicated that for all benefits to be applied they must be subject to the following criteria:
a) Transparency standard: Refers to the taxpayer’s duty to meet the information requirements of the Internal Revenue Service, in accordance with the minimum standards of the Global Forum on Transparency and Information Exchange for Fiscal Purposes.
b) Substance in the economic activity: It refers to the duty of the taxable person to maintain the documentation that reasonably supports the economic essence of its operations related to the incentives or benefits applied, in accordance with the provisions of article 17 of the Tax Code.
