Julio C. Ortiz

🚨 Important Announcement: Notifications for Businesses & Investors Holding Grants The Secretary of the Department of Economic Development and Commerce (“DEDC”) and the Director of the Office of Incentives for Businesses in Puerto Rico (“OI”) remind export service businesses and individual resident investors holding grants of tax exemption under Act No. 20-2012 and Act No. 22-2012, respectively, that the due date for filing their 2024 exempt annual reports (“EARs”) with the DEDC is May 15, 2025, or 30 days from the date of filing their 2024 Puerto Rico’s income tax returns with Puerto Rico’s Treasury Department, including any extensions. 🚨 The 2024 EARs due date for exempt businesses holding grants under Act No. 60-2019, as amended (“Act 60”), is November 15, 2025, or the 15th day of the 11th month following the closing of its tax year. Exempt businesses covered under ‘Prior Incentives Laws, as defined under Act 60, must file their 2024 EARs in accordance with the applicable law and their grant’s provisions. All EARs must be filed through the OI’s Portal of Incentives at https://lnkd.in/e38txW7U, together with the supporting documentation, and online payment of applicable filing fee. The DEDC will be strictly enforcing grantees compliance with EAR filings. Download this notification from: www.desarrollo.pr.gov For more information, please contact us at applications@ddec.pr.gov .

1

Don't Kill the Engine That’s Driving the Economy. Free zones are not tax havens — they’re Costa Rica’s growth model. Recent calls to scale back tax incentives for Costa Rica’s free zone companies have sent ripples through the investment community — and for good reason. These incentives aren’t loopholes or giveaways. They’re the scaffolding of one of the country’s most successful economic strategies. Let’s be clear: Costa Rica’s free zones generate 13.7% of national GDP, support over 200,000 jobs directly and indirectly, and offer salaries nearly double the national average. These aren’t just factories — they’re engines of technology transfer, sustainability, and formal employment. Undermining this model to patch short-term fiscal gaps would be like tearing out a building’s foundation to fix a leaky roof. If incentives are rolled back, new investors will look elsewhere — to Mexico, Colombia, Asia. Existing companies may shrink or pull out entirely. The ripple effect? Fewer jobs, lower exports, and ironically, less tax revenue down the line. The idea that removing incentives would increase income is not just flawed — it’s dangerous. The Global Game Has Changed: The U.S. is rethinking its supply chains. Nearshoring is no longer theory — it’s strategy. Costa Rica, with its stable democracy and proven free zone model, should be a natural ally. Dismantling that model now would be geopolitical malpractice. We need to double down, not step back — positioning our zones as strategic partners in regional supply chains. Instead of scrapping the regime, let’s improve it: • Demand stronger reinvestment commitments. • Expand free zones into underserved regions. • Strengthen oversight without undermining competitiveness. Let’s turn our free zones into platforms for inclusion and innovation, not political targets. Costa Rica doesn’t need to choose between fiscal responsibility and competitiveness — it needs to balance both. But doing so means protecting what works. As long-term investors and operators of Costa Rica’s industrial parks, we at Zeta Group urge policymakers to defend the country’s most powerful economic tool — and help write its next chapter, not its obituary.

79

5 Comments

📣 𝗣𝘂𝗲𝗿𝘁𝗼 𝗥𝗶𝗰𝗼 𝗧𝗿𝗲𝗮𝘀𝘂𝗿𝘆 𝗨𝗽𝗱𝗮𝘁𝗲𝘀 𝟮𝟬𝟮𝟲 𝗥𝗲𝘁𝗶𝗿𝗲𝗺𝗲𝗻𝘁 𝗣𝗹𝗮𝗻 𝗟𝗶𝗺𝗶𝘁𝘀 The Puerto Rico Department of the Treasury has issued Internal Revenue Circular Letter No. 26-03 (CL IR 26-03), updating the 2026 contribution and benefit limits for qualified retirement plans under the Puerto Rico Internal Revenue Code. If your company sponsors a defined benefit, defined contribution, or dual-qualified plan, these new limits may impact your plan design, compliance, and administration processes. 🔹 𝗞𝗲𝘆 𝟮𝟬𝟮𝟲 𝗣𝗹𝗮𝗻 𝗟𝗶𝗺𝗶𝘁𝘀  • Defined Benefit Annual Limit: $290,000 (up from $280,000 in 2025)  • Defined Contribution Annual Limit: $72,000 (up from $70,000 in 2025)  • Annual Compensation Limit: $360,000 (up from $350,000 in 2025)  • Highly Compensated Employee Threshold: $160,000 (unchanged)  • Elective Deferral (Dual-Qualified Plans): $22,500 (up from $20,000)  • Elective Deferral (PR-Only Plans): $15,000 (unchanged)  • Catch-Up Contributions: $1,500 (PR-only, unchanged); $8,000 (federal or dual-qualified) Staying compliant with these updated thresholds is critical to preserve plan qualification and prevent costly corrections. #PuertoRicoTax #RetirementPlans #EmployeeBenefits #CorporateLaw #PuertoRicoLaw

7

Simplified Joint-Stock Companies (EAS): Paraguay’s New Magnet for Foreign Investment Paraguay is implementing Simplified Joint-Stock Companies (EAS) as a more agile, cost-effective, and modern alternative to traditional entities like LLCs and corporations. EAS permits company incorporation with a single shareholder, lower minimum capital, and simplified registration procedures that reduce time and administrative barriers. This offers local entrepreneurs and foreign investors an easier path to establishing operations in South America. Amid growing regional competition, Paraguay is enhancing its business environment with administrative simplification, SME incentives, and pro-market policies. EAS serve as a strategic tool to: - Attract foreign capital - Support startups and tech-driven projects - Encourage business formalization - Generate skilled employment - Diversify productive sectors This legal framework aims to position Paraguay as a regional gateway for innovative, high-impact investments.

3

Mexico – New Tax Withholding Rules for Digital Platforms (2026 Reform) Mexico is entering 2026 with a strong push to modernize and tighten its digital economy tax framework. The Finance Bill 2026 introduces important updates that significantly expand the responsibilities of digital platform operators acting as intermediaries. Effective January 1, 2026, platforms that facilitate third-party supplies must comply with stricter withholding and reporting obligations. 🔹 Income Tax (ISR) Withholding Changes 🔸 The withholding income tax rate for natural persons increases from 1% to 2.5% 🔸 A new 4% ISR withholding rate applies to legal persons that provide a valid RFC (tax registration number) 🔸 If a legal person fails to provide a valid RFC, the withholding rate jumps to 20% This shift clearly incentivizes proper tax registration and transparency among platform sellers. 🔹 VAT Withholding Framework Digital platform operators must continue operating under a dual VAT withholding mechanism: 🔸 When the underlying seller provides a valid RFC, the platform withholds 50% of the VAT 🔸 If the RFC is missing, the platform must withhold 100% of the VAT amount This approach strengthens enforcement while ensuring tax collection at the platform level. 🔹 Expanded Reporting & Transparency Obligations 🔸 Platforms must submit detailed informative reports to the Mexican Tax Administration Service (SAT), including mandatory data on sellers and service providers 🔸 For non-resident suppliers, additional transaction-level and identification data must be provided 🔸 Platforms must establish a real-time online communication channel with SAT, ensuring direct access to transactional tax information This marks a major shift toward continuous digital oversight and near real-time tax monitoring. 🔹 What This Means for Platforms Digital platforms operating in Mexico are no longer just facilitators. They are central compliance actors responsible for: 🔸 Correct withholding logic 🔸 Verification of tax IDs (RFC) 🔸 Real-time data transmission 🔸 Expanded seller due diligence The 2026 reform reinforces Mexico’s strategy to close tax gaps in the digital economy and increase revenue transparency. Interested to learn more: https://lnkd.in/dJShJjGp 💬 Are your withholding systems, seller onboarding checks, and reporting tools aligned with Mexico’s 2026 digital platform rules? The shift toward real-time tax supervision is accelerating. Preparation now can prevent costly penalties later. #Mexico #DigitalPlatforms #WithholdingTax #ISR #VAT #Ecommerce #TaxCompliance #FinanceBill2026

8

Budgeting and Forecasting: The Roadmap for SME Success For many SMEs in Mexico, financial planning often takes a backseat to day-to-day operations. Yet, without a clear budget and an adaptable forecast, businesses risk navigating blindly in an increasingly volatile market. Budgeting and forecasting are not just accounting exercise - they are essential strategic tools that transform uncertainty into clarity and control. A budget serves as the financial roadmap, aligning resources with business goals. It gives clarity on revenue expectations, expense priorities, and investment plans. Meanwhile, forecasting acts as the radar, scanning ahead to detect potential obstacles and opportunities. Together, they provide the visibility needed to manage cash flow, control costs, and make timely decisions. The importance of these tools is amplified in Mexico, where inflationary pressures, fluctuating exchange rates, and payment delays create constant unpredictability. Without structured planning, companies react rather than anticipate; often at great cost. Core Components: 1. Start with Realistic Budgets Base budgets on historical data, but adjust for current conditions like inflation, labor costs, and market trends. Include fixed and variable expenses, and don’t forget tax obligations - an area where many SMEs fall short. 2. Implement Rolling Forecasts Static annual budgets become obsolete in dynamic markets. A rolling forecast - updated monthly or quarterly - provides agility, allowing businesses to respond to new opportunities or risks in real time. 3. Analyze Variances Regularly compare actual results against your budget. Variance analysis highlights areas where performance deviates from expectations, enabling corrective action before issues escalate. 4. Link Forecasting to Cash Flow Sales projections and profitability mean little if liquidity cannot support operations. Integrate cash flow forecasting into your process to anticipate funding needs and avoid surprises. Benefits for SMEs: Proactive Decision-Making: Whether it’s hiring new staff or negotiating supplier terms, planning enables informed choices. Stronger Lender Confidence: Banks and investors favor businesses with documented plans and financial discipline. Volatility Resilience: Scenario planning - best case, worst case, and base case - equips SMEs to adapt quickly when conditions change. Role of the Fractional CFO: Many SMEs lack the internal capacity for robust budgeting and forecasting. A fCFO can fill this gap; designing processes, implementing financial tools, and ensuring alignment between strategy and execution. This expertise turns planning from a sporadic exercise into an ongoing discipline; supporting sustainable growth. Budgeting and forecasting are not optional - they are the foundation of financial control. For SMEs navigating inflation, delayed payments, and competitive pressures, these tools provide the clarity needed to steer confidently toward long-term success.

1

 I’m sharing an updated snapshot of the Representative Offices in Colombia of foreign financial entities (Type 20). According to the public information disclosed by the Superintendencia Financiera de Colombia –in line with its transparency policies–, as of August 18, 2025, there are 37 representative offices active in the country. While Colombia remains an attractive market and regional hub, it is also a dynamic environment where some institutions exit, while others strengthen or expand their presence. 🌍 The geographic distribution highlights the strategic role of Colombia in global finance: 𝗘𝘂𝗿𝗼𝗽𝗲 leads the presence, with banks from Switzerland, Germany, France, the United Kingdom, and Spain — reinforcing their historic role in investment banking and wealth management. 𝗧𝗵𝗲 𝗨𝗻𝗶𝘁𝗲𝗱 𝗦𝘁𝗮𝘁𝗲𝘀 maintains a key position, represented by large-scale institutions across commercial banking, investment, and custody services. 𝗔𝘀𝗶𝗮 contributes with entities from Japan and South Korea, reflecting the growing interest in strengthening financial ties with Latin America. 𝗟𝗮𝘁𝗶𝗻 𝗔𝗺𝗲𝗿𝗶𝗰𝗮 is represented by banks from Panama, Peru, Chile, Costa Rica, and Nicaragua, consolidating the regional proximity and integration. This map of representation underlines the strategic importance of Colombia to a diverse range of financial systems, from universal banks to specialized institutions. What do you think? Will 2025 bring new licenses and entrants, or rather a consolidation of the players already established in the market?

10