RULING Nº SNAT/2020/00006, INCREASING THE TAX UNIT FROM VEB 50.00 TO VEB 1,500.00

Last of March 13th, 2020 Administrative Ruling SNAT/2020/00006, issued by the National Integrated Service of Customs and Tax Administration (“SENIAT”)
increased the Tax Unit (“U.T.”) from FIFTY BOLIVARS (VEB 50.00) to ONE THOUSAND FIVE HUNDRED BOLIVARS (VEB 1,500.00) (Official Gazette of the
Bolivarian Republic of Venezuela N° 41.839).

The U.T. has been used since 1994 as a mechanics for keeping the value of fixed taxes, tax bases, tax brackets, de minimis exemptions, characterization as special taxpayer and fines and penalties in real value in light of inflation (fines and penalties for new breaches are adjusted on different terms under the the Master Tax Code “passed” on January 2020). The increase was issued without due compliance with the process mandated by the Master Tax Code (obtaining a prior positive opinion from the National Assembly).

According to Article 2 of the Ruling, the value of the Tax Unit “may only be used as a Measurement Unit for the National Taxes determination whose collection and control are Service”, not being able to be used by other State governmental bodies or entities to determine labor benefits or special rates and contributions derived from the services they provide. The reference to Service is confusing, to say the least, as it can refer to taxes administered by autonomous services (e.g. SENIAT) or taxes (duties and contributions) associated with the provision of services. A reasonable interpretation of the rule would be the first, but having the authorities issuing guidance on the matter or amending would be welcome.

On the other hand, Article 3 provides that in the case of taxes that are computed on annual terms, the applicable Tax Unit will be the one in force for at least
one hundred eighty-three (183) continuous days of the corresponding term, and for taxes that are computed on terms other than the annual (e.g. VAT), the applicable Tax Unit will be the one in force at the beginning of the term, “all in accordance with the provisions of the Third Paragraph of Article 3 of the Mater Tax Code” (we understand the reference to the Master Tax Code COT 2014), as it would be the result of the Constitutional principles of transitional application of tax rules.

The Administrative Ruling entered into force on the date of its publication in the Official Gazette.

Rodolfo Plaz Abreu
rplaz@tpa.com.ve

Juan Carlos Garantón-Blanco
jgaranton@tpa.com.ve

Valentina Cabrera Medina
vcabrera@tpa.com.ve

Valmy Díaz Ibarra
vdiaz@tpa.com.ve

Annette Annia Vargas
aannia@tpa.com.ve

Carlos Da Silva
cdasilva@tpa.com.ve