Bolivia's Vat Tax: Understanding The Basics

Bolivia's Value-Added Tax (VAT) regime was introduced in July 1986 and is known locally as Impuesto al Valor Agregado (IVA). The standard VAT rate in Bolivia is 13% on the net sale price, which is included in the final price, resulting in an effective tax rate of 14.94%. This applies to the sale of movable goods and the provision of services within the country, as well as imports. Businesses must register and charge VAT on taxable supplies, and foreign businesses are expected to file tax returns every month.

Bolivia's VAT rate is 13%

Bolivia's standard VAT rate is 13%. This rate applies to the sale of movable goods and the provision of services within Bolivia, including imports. The effective VAT rate, however, is 14.94% as VAT is charged on the gross amount.

Bolivia introduced its Value-Added Tax regime in July 1986. It is locally termed "Impuesto al Valor Agregado (IVA)". The VAT rules are outlined in the VAT Law and are administered by the National Tax Service (Servicio de Impuestos Nacionales).

Businesses providing taxable supplies, such as imports, goods and services within Bolivia, and leasing movable or fixed goods, must register and charge VAT. It is important to note that exports are zero-rated.

Foreign businesses selling digital products to customers in Bolivia must also comply with Bolivian VAT rules and charge the standard VAT rate of 13%. They must register their business for Bolivian VAT, even if they make just one sale in the country.

VAT is due at the time of supply

Bolivia introduced its Value Added Tax (VAT) regime in July 1986. It is known as Impuesto al Valor Agregado (IVA) locally. The standard VAT rate in Bolivia is 13%. However, due to the way it is calculated, the effective rate is 14.94%. This is because VAT is calculated on the gross amount, and so the effective rate is higher than the standard rate.

For imported goods, the VAT is due when the goods clear customs. This is the "tax event" for imported goods. It is important to note that exports are zero-rated, meaning no VAT is charged on goods exported from Bolivia.

Businesses providing taxable supplies must register and charge VAT. These supplies include imports into Bolivia, providing goods and services within the country, and leasing movable or fixed goods. It is important to note that there is no reverse charge mechanism in Bolivia for services provided to residents by non-residents. These transactions fall outside the scope of Bolivian VAT.

VAT invoices must be supplied for all taxable supplies above BOB 5. The invoice must include specific information, such as the name and address of the supplier and customer, tax numbers, a unique invoice number, a description of the goods or services provided, and the VAT rate and amount charged.

Foreign businesses must file tax returns monthly

Bolivia introduced its Value Added Tax (VAT) regime, termed Impuesto al Valor Agregado (IVA) locally, in July 1986. The standard VAT rate in Bolivia is 13% of the net sale price. This is levied on almost everything sold in the country, including digital products.

Foreign businesses must file tax returns every month in Bolivia. This is a key requirement for staying tax-compliant. Foreign legal entities are considered residents if they establish a formal domicile within the national territory of Bolivia and complete all the formal procedures required by law.

To register for VAT in Bolivia, foreign businesses must sign up through a local tax representative. This will result in a VAT registration number, which establishes the business in the Bolivian tax system as a legal entity. This number is used to track the business's taxes, tax credits, and the VAT charged to customers.

VAT invoices must be supplied for all taxable supplies above BOB 5. They should include the following information:

• Name and address of the supplier
• Tax number of the supplier
• Name, address, and tax number of the customer
• Indication that it is a tax invoice ('FACTURA')
• Unique, sequential invoice number with an expiry date and security code
• Virtual invoicing system number and QR code
• Description of the goods or services provided, including unit prices
• VAT rate, amount charged, and gross amount of the invoice

Invoices may be issued in a foreign currency but must include the Bolivianos equivalent prices and VAT, converted at the rate of the Central Bank. Bolivia is also introducing a new real-time e-invoicing system, which applies to most larger businesses that must provide real-time invoices to the tax authorities via a portal.

VAT invoices are required for taxable supplies over BOB 5

Bolivia's Value-Added Tax (VAT) regime was introduced in July 1986 and is termed Impuesto al Valor Agregado (IVA) locally. The standard VAT rate in Bolivia is 13%, but the effective rate is 14.94% because VAT is levied on the gross amount.

Businesses providing taxable supplies must register and charge VAT. These supplies include imports into Bolivia, the provision of goods and services within Bolivia, and leasing movable or fixed goods.

VAT invoices are required for all taxable supplies over BOB 5. The following information must be included on the invoice:

• Name and address of the supplier
• Tax number of the supplier
• Name, address, and tax number of the customer
• Indication that it is a tax invoice ('FACTURA')
• Unique, sequential invoice number with an expiry date and security code
• Virtual invoicing system number and QR code
• Description of the goods or services provided, including unit prices
• VAT rate, amount charged, and gross amount of the invoice

There are several formats for Bolivian-compliant invoices, including paper, e-invoices, and web-based invoices (Sistema de Facturación Virtual). Invoices may be issued in a foreign currency but must include the Bolivianos equivalent prices and VAT, converted at the Central Bank rate.

Bolivia introduced a new real-time e-invoicing system, Sistema de Facturación Electrónica, between March 2019 and February 2020. This applies to most larger businesses, which must provide real-time invoices to the tax authorities via a portal.

Bolivia introduced VAT in July 1986

Bolivia introduced its Value Added Tax (VAT) regime in July 1986. Known locally as Impuesto al Valor Agregado (IVA), the VAT rules are contained within the VAT Law. The VAT is administered by the National Tax Service, or Servicio de Impuestos Nacionales.

The introduction of VAT in Bolivia was part of a wider tax reform, which aimed to increase tax receipts and improve tax administration. The tax system prior to 1986 was described as "chaotic", with over 400 separate national, departmental, and municipal taxes. Tax administration was largely ineffective, with outdated taxpayer registers and delayed record-keeping. Data processing was also virtually non-existent.

The new VAT regime simplified the tax system and made it more efficient. Businesses providing taxable supplies, including imports, goods and services within Bolivia, and leasing movable or fixed goods, must register and charge VAT. The standard VAT rate in Bolivia is 13%, although the effective tax rate is 14.94% because VAT is charged on the gross amount.

The introduction of VAT in Bolivia was a significant change, and it contributed to an increase in tax receipts. By 1990, the tax burden had risen to 7.4% of GDP, up from 1% in 1985. This increase in tax revenue helped to replenish government coffers and improve the country's economic situation.

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