La Paz
EY
20 de Octubre Avenue and Campos #2665
Torre Azul Building
16th Floor
P.O. Box 2221
La Paz
Bolivia
Indirect tax contact
Juan Pablo Vargas
Santa Cruz
EY
+591 (3) 342-9230
juan.vargas@bo.ey.com
Avenue Cristo Redentor and Cuarto Anillo
Torre Empresarial MSC Building
13th Floor, office # 13-B
Santa Cruz
Bolivia
Indirect tax contact
Juan Pablo Vargas
A. At a glance
Name of the tax
Local name
-4
-4
+591 (3) 342-9230 juan.vargas@bo.ey.com
Value-added tax (VAT)
Impuesto al Valor Agregado (IVA)
Date introduced 1 July 1986
Trading bloc membership
Bolivia-Mexico ACE N°66
Bolivia-Chile AAP.CE N°22
Bolivia-Mercosur (Bolivia, Argentina, Brasil, Paraguay and Uruguay) AAP.CE N°36
Bolivia-Cuba AAP.CE N°47
Bolivia-Venezuela
Andean community CAN (Bolivia, Colombia, Ecuador y Perú)
Administered by Internal Taxes Service (http://www.impuestos.gob.bo) Servicio de Impuestos Nacionales (SIN)
VAT rates
Standard 13%
Other Zero-rated (0%) and exempt
VAT number format 9999999999 (tax identification number [NIT]) (Número de identificación tributaria)
VAT return period Monthly
incorporate (if the person is already registered) or register with the tax authority for the payment of taxes.
In the case of nonresidents, there are no rules for the payment of taxes in Bolivia.
Bolivia’s Congress had previously initiated discussions on a bill to impose 13% VAT on digital services provided from abroad to Bolivian residents, but this was subsequently discarded. At the time of preparing this chapter, it is not certain whether this project will be reconsidered.
There are no other specific e-commerce rules for imported goods in Bolivia.
Online marketplaces and platforms. No special rules exist for online markets or platforms in Bolivia. The general rules state only that the sale of goods through electronic commerce, within the national territory, made by natural and legal persons, are subject to the VAT, but there are no detailed procedures.
Registration procedures. The registration application can be made using one of two methods: 1. In person at the offices of the tax administration
2. Online through the “Digital Biometric Register” link under the “SIAT Online” option on the tax authority´s website(https://www.impuestos.gob.bo).
The following documents are required
• Notarized incorporation deed
• The legal representative’s valid identification document (ID)
• Notarized power of attorney for the legal representative to act with authority for the applicant
• Electric utility invoice for the company domicile
• Electric utility invoice for the legal representative’s domicile
• Map (drawing) of the domiciles of the company and the legal representative
If the application is made in person, the legal representative must bring the documents (original and copy). If the application is made online, the documents must be sent digitally (scanned) through the “Digital Biometric Register” link under the “SIAT Online” option.
After receiving the application and verifying the documents (in both methods), the tax authority conducts an “in situ” visit to the company´s address.
The registration can be processed in one to two weeks, provided all documents are submitted in the correct format to the tax authority and the visit to the tax domicile is carried out.
Deregistration. In Bolivia, companies do not deregister. It is possible, however, to deactivate the tax identification number.
Changes to VAT registration details. Any change related to the registered information of a taxable person and the activity of the company should be communicated immediately to the tax administration.
The changes to VAT registration are simplified regime to special regime, inactivation of economic activity, taxable person data, activity economy, legal representative, domicile of taxable person and legal representative, etc.
For the procedure, the taxable person should visit the tax administration office in person as soon as the modification occurs with the documents that support the changes.
D. Rates
The term “taxable supplies” refers to supplies of goods and services that are liable to a rate of VAT, including zero rate.
The VAT rates are:
• Standard rate: 13% (however, the effective rate is 14.94% because VAT must be included in the sales price)
• Zero-rate: 0%
The standard rate of VAT applies to all supplies of goods or services unless a specific measure provides for the zero rate or an exemption.
Examples of goods and services taxable at 0%
• Exports
The term “exempt supplies” refers to supplies of goods and services that are not liable to VAT and that do not qualify for input tax deduction.
Examples of exempt supplies goods and services
• Goods imported by members of diplomatic corps recognized in Bolivia
• “Bona fide” introduced merchandise, up to a limit of USD1,000
• Life insurance quotas (monthly payments with respect to a life insurance contract)
• For securities registered on the Bolivian Stock Exchange, capital gains generated by sales/ purchase of the shares
• Transfers of goods or assets subject to the securitization process (titularización) administered by the securitization association, at the beginning and end of the process (under this process, the goods must be transferred to an independent fund (patrimonio autonomo) and, when the process is completed, the goods are returned to the original owner)
• Operations regarding sales or transfers of portfolios (financial intermediation, insurance and pension)
• Interest from loans received by financial entities
• Inbound tourism and lodging services for foreign tourists without a residence or address in Bolivia
• Artistic events focused on production, presentation and promotion of theater, dancing, national folklore, painting, sculpture and movies of Bolivian artists, if they are sponsored or developed in locations in Bolivia that are managed or owned by a municipal government or the Bolivian government
• Sale of books printed in Bolivia or those imported by or published by Bolivian institutions
Option to tax for exempt supplies. The option to tax exempt supplies is not available in Bolivia.
E. Time of supply
The time when VAT becomes due is called the “time of supply” or “tax event.” The tax event for goods is when the goods are delivered or when an act that implies the transfer of the ownership occurs. The tax event for services is the earlier of when the service is performed or completed and when full or partial payment of the price is received.
Deposits and prepayments. There are no special time of supply rules in Bolivia for advance payments. As such, the general time of supply rules apply (as outlined above). The only exception is for advanced payments for construction services for government entities, where the payments will not be subject to taxation until the work progress certificates are accomplished.
Continuous supplies of services. For the provision of continuous services, when the taxable event is concluded at the expiration of each monthly period, the invoice may be issued up to the fifth business day of the month following the month in which the service was provided.
For the provision of continuous services subject to measurement or settlement, the taxable event is perfected in the determination of the price, as a result of the monthly measurement or settlement of the service, as the case may be, or at the partial or total collection of the remuneration,
H. Invoicing
VAT invoices. A taxable person must provide a VAT sales invoice for all taxable supplies made, including exports (subject to VAT at the zero rate). According to the invoicing modality (due to be implemented as of 1 December 2021), in paper or electronic format, a VAT invoice is required to support a claim for input tax deduction.
Credit notes. A credit note can be used to reduce the VAT charged and reclaimed on a supply of goods and services. A credit note must contain the same information as a sales invoice, and it can only be used with respect to the return of goods (total or partial) and the cancellation of services.
Conciliation notes are used to adjust the VAT tax debit and credit in transactions for electric power, telecommunications, potable water and hydrocarbon services, as part of a reconciliation process of the parties involved.
Electronic invoicing. Electronic invoicing is mandatory in Bolivia for certain taxable persons.
Scope of electronic invoicing. For B2B, B2C and business-to-government (B2G) supplies, electronic invoicing is mandatory for certain taxable persons in Bolivia.
The tax authority issued the Regulatory Directory Resolution (RND) No. 102100000011 on 11 August 2021, which defined a new invoicing system and the implementation of certain modalities of online invoicing (electronic invoicing). This new invoicing system is effective as of 1 December 2021 for certain taxable persons that the tax authority has defined. The tax authority, according to a timetable, establishes the invoicing modality that the rest of the taxable persons (individuals and legal entities registered in the tax registration) must apply. The tax authority maintains the allocation of 12 taxpayer groups for the transition to electronic invoicing, and by the end of 2024, implementation is expected up to group 9.
Electronic invoicing includes taxpayers assigned by the tax authority for the change of activity. This invoicing must be issued by the taxpayer for any sale to their customers (B2G, B2B and B2C).
The types of invoices are:
• Manual invoice
• Pre-valued invoice
• Computerized invoice VIS (virtual invoicing system)
• Online electronic
• Online computerized
• Online web portal
The type of invoice that can be used will depend on the assignment by the tax authority to the taxable persons, which depends on the quantity of monthly invoices, the amounts, kind of company, etc.
The tax authority also defines the requirements for the invoice design.
Simplified VAT invoices. In cases of retail supplies sales for amounts less than BOB5, full VAT invoices are not mandatory to be issued for such transaction. In these cases, the seller could issue a summary invoice at the end of the day that includes all these sales.
Self-billing. Self-billing is not allowed in Bolivia.
Proof of exports. Bolivian VAT is not chargeable on supplies of exported goods. However, to qualify as VAT-free, exports must be supported by evidence that the goods have left Bolivia. The related input tax can be reimbursed through issuance of tax devolution certificates (CEDEIMs) that can be negotiated as securities. Invoices for export transactions must be identified with the
text “Commercial invoice for exports” (Factura comercial de exportación) and must be specifically authorized by the tax authorities.
Foreign currency invoices. The invoices should be issued in the domestic currency, which is the Bolivian boliviano (BOB). In case the vendor needs to include another currency, the value should be converted using the official exchange rate on the tax event date published by the Bolivian Central Bank.
Supplies to nontaxable persons. Issuing a VAT invoice is mandatory in any case, even if the purchaser (non-registrant) does not require the invoice.
For purchases for amounts less than or equal to BOB1,000 when the buyer does not provide its data, the following must be entered: In the name or company name field the words “no name” or “N/N” and in the NIT/CI field the value zero.
There are some specific sectors in Bolivia that are allowed to not issue VAT invoices. These are the “Simplify Regime” (retail merchants, craftsmen with incomes less than USD26,500, approximately) and the “Integrated Regime” (transport services with people owner of no more than two vehicles).
Records. In Bolivia, examples of what records must be held for VAT purposes include purchase and sales VAT books (these are required to be reported monthly to the tax authority). Also, the following must also be held:
• Counterfoil of the invoices that are being used (manual and prevailed billing)
• Book of minor sales of the day, if applicable
Also, the company must maintain in digital or physical formats, according to current provisions, all the documentation that supports the transactions, for the term of the statute of limitations. In Bolivia, VAT books and records can be kept outside of the country. However, such records must be available to provide to the tax administration in a timely manner for a tax audit (i.e., commonly the tax auditor requires the information within five working days from the inspection’s start day).
Record retention period. The record retention period in Bolivia is eight years. This is to enable the tax administration to control, verify, supervise, investigate, determine the taxes and collection within this period.
Electronic archiving. Electronic archiving is allowed in Bolivia. The tax administration allows the sending of digital information (books of purchases and sales, tax forms). However, there are no specific rules for electronic archiving, but in practice, businesses keep records in physical (paper) format.
I. Returns and payment
Periodic returns. VAT returns are submitted for monthly periods. Returns are due between the 13th and the 22nd day of the month following the end of the return period. The due date depends on the last digit of the taxable person’s identification number (NIT).
Periodic payments. Payment is due in full between the 13th and the 22nd day of the month following the end of the return period. The due date depends on the last digit of the taxable person’s identification number (NIT).
VAT liabilities must be paid in local currency (BOB) or in “Tax Refund Certificates.”
For the payment, the taxable person must be registered in a document called “affidavit,” which can be done through the virtual platform that only the taxable person has access to, by entering its data in the official website of tax administration. Alternatively, the taxable person can go in
person to the tax administration and get help with the filing of the affidavit. Once the affidavit is completed, it generates an order number, which is used for the payment for the tax declared for a bank institution or bank transfer.
Electronic filing. Electronic filing is mandatory in Bolivia for all taxable persons. VAT returns must be submitted through the tax authority’s virtual platform. The virtual platform is a web digital platform where only the taxable persons have access through the tax administration official website and can flag the tax status of the company.
Payments on account. Payments on account are not required in Bolivia.
Special schemes. The below special regimes have the characteristic of being small businesses, therefore, invoicing is not mandatory, as well as these regimes pay a consolidated tax that includes VAT, CIT and transaction tax.
Simplified Regime. This regime includes artisans, retail traders and vendors (persons who sell beverages and food in kiosks and small premises). Persons under this regime are not required to issue VAT invoices.
Unified Agricultural Regime. This regime includes individuals who carry out agricultural or livestock activities, producers grouped in Small Producers Organizations and all those individuals who are engaged in poultry farming, beekeeping, floriculture, rabbit farming, fish farming and viticulture. Persons under this regime are not required to issue VAT invoices.
Integrated Tax System. In this regime are all those individuals who provide interprovincial public transportation services of passengers or cargo and urban public transportation of passengers or cargo, who have up to two vehicles registered in their name. Persons under this regime are not required to issue VAT invoices.
Annual returns. Annual returns are not required in Bolivia.
Supplementary filings. VAT purchases and sales book. VAT purchases and sales book must be submitted monthly through the tax authority virtual platform.
Correcting errors in previous returns. It is possible to correct errors in tax returns in Bolivia using one of two options:
• When the corrections are in favor of the tax administration, the taxable person should amend the tax return through the virtual office and pay the omitted tax.
• When the corrections are in favor of the taxable person, it is necessary to request to the tax administration the respective approval, which commonly is completed after a tax review.
Digital tax administration. The tax returns and the additional obligations (such as the auxiliary books of purchases and sales) should be reported digitally through the virtual office. This is a real-time reporting obligation in Bolivia.
J. Penalties
The penalty amounts charged in Bolivia are based on how much the input tax credit is adjusted. This is based on the variation of the Unidades de Fomento a la Vivienda (UFV), an index published by the Bolivian Central Bank that accounts for inflation.
Penalties for late registration. The penalty for late VAT registration is UFV2,500. Subsequently the company is requested to register and obtain a tax identification number (NIT). The penalties do not prevent the revenue authority to start a tax audit on the company and determinate a tax debt, for the periods where the company was performing business activity without being registered for VAT. Where the company refuses to pay the penalties and proceeds with the VAT registration and continues performing business activity, the revenue authority’s last action is to close the business until the situation is rectified.