Comparison Guide
Paraguay vs. Uruguay vs. Argentina: where is it best to invest or live?
Three of the most-consulted destinations for companies, investors and professionals in the region when deciding where to settle. We compare taxes, company formation and residency options across the three countries, with a practical, no-nonsense take.
Contents
Tax burden
The three countries have very different tax structures. Paraguay stands out for its simplicity: a general 10% rate applies across VAT, corporate income tax and personal income tax. Uruguay and Argentina, by contrast, have progressive schemes with higher top-bracket rates.
| Tax | Paraguay | Uruguay | Argentina |
|---|---|---|---|
| VAT | 10% | 22% general (10% reduced rate in some sectors) | 21% general (10.5% and 27% in specific sectors) |
| Corporate income | 10% (IRE) | 25% (IRAE) | Progressive: 25% / 30% / 35% depending on profit level |
| Personal income | 10% (IRP) | Progressive, between 10% and 36% (IRPF) | Progressive, up to 35% |
Uruguay's and Argentina's progressive brackets are adjusted periodically; we show each scheme's minimum and maximum rate rather than the exact figures per bracket, which change over time. Uruguay also taxes its tax residents mainly on Uruguayan-source income (territorial regime), with different treatment for foreign-source income — covered below.
Company formation
In all three countries, a foreign individual or company can hold 100% of a local company, with no need for a local partner.
| Paraguay | Uruguay | Argentina | |
|---|---|---|---|
| Common structures | EAS, SRL, SA | SRL, SA, SAS | SRL, SA, SAS |
| 100% foreign ownership | Yes | Yes | Yes |
| Estimated timeline | 2–4 weeks | A few weeks, depending on the structure chosen | Variable — from a few weeks (SAS) to several months for more complex structures |
Paraguay tends to be the fastest and most affordable thanks to the EAS (Simplified Joint-Stock Company), designed for a single shareholder. Uruguay and Argentina also offer simplified structures (SAS) that speed up the process compared to a traditional SA or SRL, though real timelines depend heavily on each public registry's workload at the time.
Residency
All three countries have immigration pathways designed for investors, passive-income earners or independent professionals, plus special regimes for MERCOSUR citizens.
- Paraguay: temporary and permanent residency for foreigners, with a simplified regime for MERCOSUR citizens, and the Paraguay Investor Pass as a route to permanent residency through investment.
- Uruguay: legal residency through passive income ("rentista") and, separately, the possibility of obtaining tax residency — a distinct status, relevant for tax treatment — through physical presence or a qualifying investment.
- Argentina: a simplified regime for MERCOSUR citizens, and a residency route through income or investment for other foreigners.
Uruguay: new-resident regime
One of the most-asked-about points regarding Uruguay is that, under certain conditions, it offers a temporary exemption on foreign-source income tax for those who become new tax residents — designed to attract international capital and investors. The benefit includes an exemption period, followed by a transition phase with a reduced rate before moving to the general regime.
The requirements to qualify (time spent in the country or a certain investment level) and the exact terms of the benefit are set by Uruguayan regulations that are updated from time to time — the version currently in force stems from changes approved in late 2025. That's why we don't include specific figures or terms here: we recommend confirming them with our team or a Uruguayan tax advisor before making a decision based on this figure.
A note on Argentina
Argentina combines a large market and a diversified economy with a history of currency controls that have eased significantly since 2025, under an IMF-backed economic program. Even so, it's a moving target that's worth checking at the specific moment of each transaction — not something worth stating as a fixed fact in a general guide.
If you're considering moving capital to or from Argentina, or repatriating profits, the recommendation is simple: confirm the current currency-control situation with a local advisor before defining your structure, rather than going by what any article (including this one) said at a different point in time.
Comparison table
| Paraguay | Uruguay | Argentina | |
|---|---|---|---|
| Simplicity of the tax system | High — single 10% rate | Medium — progressive, with a special regime for new residents | Medium-low — progressive, more complex in practice |
| Speed of setting up a company | Fast (EAS) | Fast to medium | Variable |
| MERCOSUR access | Yes | Yes | Yes |
| Distinctive advantage | Low, even tax burden across all taxes | Temporary exemption on foreign-source income for new residents | Market size and economic diversification |
Need help deciding?
At Desembarco Paraguay we specialize in Paraguay, but we work with a network of accountants and lawyers in Uruguay and Argentina to help you compare your specific case with up-to-date figures. Take the free assessment and let's talk, no strings attached.
Get a free assessmentFrequently asked questions
Which of the three countries has the lowest taxes?
Paraguay has the simplest and lowest overall tax burden of the three: 10% on VAT, corporate income tax (IRE) and personal income tax (IRP). Uruguay and Argentina have progressive schemes with higher top rates, though each has nuances and special regimes that can change the outcome depending on the case.
Do all three countries allow 100% foreign company ownership?
Yes. In Paraguay, Uruguay and Argentina a foreigner can hold 100% of a local company with no local partner.
What advantage does Uruguay offer new residents?
Under certain conditions, Uruguay temporarily exempts new tax residents from tax on foreign-source income. The exact requirements and terms change over time — it's worth confirming them with an advisor before planning around this figure.
Do MERCOSUR citizens have a simpler path to residency?
Yes, both Paraguay and Argentina have simplified residency regimes for citizens of MERCOSUR countries.
Does this guide replace advice from a local accountant or lawyer?
No. It's a general starting point. Exact amounts, tax brackets and immigration requirements change over time in all three countries, so any specific decision should be validated with a professional in the relevant country.
This guide is for general informational purposes only and does not constitute financial, legal or tax advice. Tax and immigration rates and amounts change over time in all three countries — always verify current information with an advisor before making a decision. Sources consulted: tax reports from international firms (including PwC and EY) and each country's public regulations, reviewed in July 2026.