Despegar's statement doesn't say it will begin paying local taxes in Argentina -- or how much -- but its actions give Latin America's largest travel agency some breathing room to work out a settlement.
Despegar, Latin America’s largest travel agency, agreed to scuttle legal actions it initiated and will begin trying to normalize its tax status in Argentina, blunting fast-moving efforts that threatened to close down the site and business, according to published reports.
However, a spokesperson for Despegar tells Skift it has not agreed to pay additional tax to Argentinian authorities, but merely agreed to convene with tax officials and analyze the situation.
“You can clearly see that AFIP closed Despegar.com without the support of the law,” a spokesperson says. “We will sit with authorities to have a look at the numbers they say that they have as a “presumption,” but this hasn´t reached up to the point of a demand.”
The site had been shut for a limited time last week, then reopened, after Argentina’s AFIB (Federal Administration of Public Revenue) accused Despegar of using its office in Delaware to evade taxes in its home country.
The AFIB alleged that Despegar had been reporting some 500 million pesos ($63.4 million) in transactions for tax purposes when in reality its transactions were 10 times greater, the Buenos Airs Herald reported.
“Despegar.com will begin to operate normally, allowing users to book hotels, flights and other tourism services as they did before,” Despegar stated. “Our more than 850 employees will return to their jobs.”
“We have dropped all court actions and are working with AFIP to analyze our fiscal obligations and the regularization of our fiscal situation,” the company stated.
Here’s Despegar’s latest statement:
“As a friendly position we talk about regularizing our situation, but this can only be done if Despegar.com is accused of something. Until today there isn´t any document showing this.
“Although we talk about regularization as a courtesy to AFIP who has read our declaration before handing it out, there is no way we can regularize any situation if there is no demand. They haven´t issued any. In some way, if you know what´s going on in Argentina, we are being followed because of the amount of dollars we move around here.
“Have a look at the articles published at Clarin, La Nación, Infobae and Perfil. They don´t share the Government´s position at all because these interventions and controls have been happening in the last 2 years.
“Today, everything is working correctly. Since Friday, AFIP has reestablished our account and we are already selling all our products.”
Free Daily Newsletter
Sign up for the most popular Skift daily download of news, happening, and headlines in the travel world
Photo credit: Despegar, Latin America's largest travel agency, has some big tax problems back home in Argentina. PlaceIt by Breezi