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Exemption from payment of Value Added Tax (“VAT”)

Decree No. 416 of the Presidency of the Bolivarian Republic of Venezuela was published in Official Gazette No. 40.257 of September 24, 2013. Said Decree establishes a VAT exemption for the final importation of essential personal hygiene products made by the agencies of the National Public Administration. The most significant aspects of this Decree are the following:

 

At the time of filing their returns, the beneficiaries must file (i) a descriptive list of the corporeal personal property to be imported and (ii) the commercial invoice issued to the name of the agency or entity of the Public Administration in charge of the acquisition of personal property indicated in the Decree.

 

The final importation of personal property subject matter of the Decree is to be made at the same customs office chosen by the beneficiary of the exemption. Likewise, the Entry Customs Office must keep a registry of the import transactions exempt from VAT payment.

 

The Decree with the Status, Value, and Force of Law that establishes the VAT provides for a periodical evaluation that must be made taking into account the quality, destination, and performance of the purpose for which the exempted corporeal personal property was intended. This evaluation will be made on a half-yearly basis by the Minister of the Popular Power for Finance in coordination with the Minister of the Popular Power for Commerce, according to the parameters to be determined by the National Integrated Service of Customs and Tax Administration (“SENIAT”).

 

The Decree also states that the benefit will cease to be given to the agencies or entities of the National Public Administration that fail to perform the (i) periodical evaluation established in the Decree and (ii) the obligations established in the Organic Tax Code and other tax rules, and in the Decree with the Status, Value, and Force of Organic Customs Law and its Regulations.

 

Finally, it is established that the benefit of exemption established in the Decree will have a maximum duration of one (1) year, as from the date of its entry into force.

 

The Decree became effective upon its publication in the Official Gazette.

 

In order to access the Decree, please click here.

 

“NOTE: THIS INFORMATION SHOULD NOT BE CONSTRUED AS LEGAL ADVICE ON ANY SPECIFIC MATTER AND ITS CONTENT ARE INTENDED AS A MANAGEMENT ALERT AS TO CURRENT DEVELOPMENTS IN VENEZUELA, ANY SPECIFIC LEGAL QUESTIONS REGARDING THE POSSIBLE APPLICATION OF NEW OR PROPOSED LEGISLATION TO PARTICULAR SITUATIONS SHOULD BE ADDRESSED TO TRAVIESO EVANS ARRIA RENGEL & PAZ.”