The new Law of the Republic determines a moratorium on the payment of VAT, income tax advance payments, excise tax and import duties, during the months of April, May and June 2020.

Upon the completion of the moratorium, taxpayers must pay the Ministry of Treasury the total amount due for taxes that should have been paid during April, May and June of the current year or agree on a payment settlement with the Tax Administration. The Tax Authorities will issue the regulations that will establish the requirements for payment settlements.

As of January 2021, such amounts due will begin to generate interests and Will be subject to penalties if not paid or if a settlement is not sign with the Tax Administration.

These provisions do not apply to taxpayers with a special tax year already authorized by the Tax Administration, meaning that they must comply with all their obligations.

Finally, it should be clarified that the moratorium determined is on the payment of such taxes, therefore, it does not exempt the taxpayers from their formal obligations. Tax returns should continue to be filed on a timely manner.

VAT exoneration for commercial leasing

Commercial rental contracts are VAT exempt for the months of April May and June 2020 as longs as both, the owner and the tenant are register before the Ministry of Treasury on the General Regimen or Agriculture Regime.

(This Law was published in La Gaceta No. 55 of Scope No. 53 of March 23rd, 2020)