Tax Stability in Chile: Guide for Foreign Investors

Foreign investors usually ask two questions before entering Chile: how much tax will the project pay, and how stable will the rules be over time.

The 2026 Chilean Tax Reform addresses both questions. In addition to reducing the corporate income tax rate for general regime companies, the bill includes a tax stability regime for large investment projects.

This article explains the topic in plain English. On August 26, 2026, Chile’s Constitutional Court confirmed the core of this regime. The final effective dates, publication date and administrative rules must still be reviewed once the law is officially published.

What is tax stability?

Tax stability means that an investor may enter into an agreement with the Chilean State under which certain tax rules remain stable for a defined period.

In practical terms, the investor obtains protection against future tax increases affecting the agreed project. This matters because large investments are usually planned over many years. A mining, energy, infrastructure or technology project cannot be evaluated only with today’s tax rate. Investors need to know whether the rules may change after capital has already been committed.

The confirmed regime has staggered stability periods: 10 years for investments from USD 50 million to USD 100 million, 15 years for investments from USD 100 million to USD 350 million, and 20 years for investments from USD 350 million. It applies to both foreign and local investors, subject to the requirements of the final law.

On August 26, 2026, Chile’s Constitutional Court confirmed the core of this regime. However, the court struck down the possibility of extending stability contracts to connected projects and removed the Finance Ministry’s discretionary power to extend the capital-inflow deadline. Investors should structure their investment amount and timeline within the confirmed rules, without relying on those two mechanisms.

Why this matters in Chile

Chile had a well-known foreign investment regime under Decree Law 600, which was used for decades and later repealed. The new regime brings back the idea of long-term tax certainty, but under a new legal framework.

For foreign investors, this may improve Chile’s position as a destination for large projects, especially in sectors where capital recovery takes many years.

Who should look at this regime?

This regime is not designed for every foreign company. It is mainly relevant for large-scale investments.

It may be useful for:

• mining projects;
• energy projects;
• infrastructure;
• technology or data infrastructure;
• industrial projects;
• long-term foreign investment platforms.

Smaller operations, service companies or regular market-entry structures will usually need a different analysis.

What should investors review?

Before relying on a tax stability regime, a foreign investor should review:

• investment amount;
• project timeline;
• sector and business model;
• corporate structure;
• expected profit distribution;
• applicable double tax treaty;
• financing structure;
• Chilean withholding taxes;
• exit strategy;
• regulatory permits.

Tax stability is valuable, but it is not the whole analysis. The legal vehicle, banking documentation and compliance, beneficial ownership, permits and tax treaty position may be equally important.

Interaction with corporate tax reduction

The reform also contemplates a gradual reduction of the corporate income tax rate for general regime companies. Investors may evaluate Chile with a lower corporate tax burden than the one currently in force, subject to the effective dates in the final published law.

However, foreign investors should not look only at corporate tax. The complete picture includes dividend taxation, withholding taxes, tax credits and treaty relief.

Practical example

Imagine a foreign group evaluating an infrastructure project in Chile. The investment requires significant capital expenditure and may take several years before generating stable returns.

In that case, a tax stability agreement could help the investor model the project with more certainty. Banks and financing partners may also value that predictability.

But before moving forward, the group should review whether the project qualifies, how the investment will enter Chile, and what tax treaty applies to future profit distributions.

How IDC can help

At Izquierdo Deramond Consultores, we assist foreign investors entering Chile through corporate setup, tax planning, local representation, banking coordination and back-office support.

For large projects, we can review whether the new tax stability regime is relevant and how it interacts with the investor’s Chilean structure.

FAQs

Is the new tax stability regime already in force?

Congress approved the bill on August 4, 2026, and Chile’s Constitutional Court issued its decision on August 26, 2026, confirming the core of the tax stability regime and most of the bill. The regime is not yet practically effective until the final text is published in the Official Gazette and the applicable effective dates are confirmed.

Is it useful for any foreign investor?

No. It is mainly aimed at large-scale investment projects. Smaller companies usually need a different tax and corporate analysis.

Does tax stability replace tax planning?

No. It must be reviewed together with the corporate structure, treaty position, financing and profit distribution.

Can IDC assist foreign investors in Chile?

Yes. IDC advises foreign investors on corporate structuring, tax analysis, local representation, accounting coordination and ongoing compliance.

View the 2026 Tax Reform hub