Tax Actions Taken By the Bolivian Government As An Effect Of Coronavirus
After World Health Organization (WHO) declared Coronavirus (COVID-19) a pandemic, the Bolivian Government assumed different measures to stop the massive contagion of this virus in the society, as well as to alleviate the effects of this pandemic on the Bolivian society as a whole and, in particular, on social groups with a depressed economic situation. In that sense, the Bolivian Government declared a National Health Emergency and Total Quarantine throughout Bolivian territory, suspending -temporarily- labor activities for public and private companies until April 15.
In this context, the National Government adopted emergency and temporary tax measures established by Supreme Decree No. 4198, dated March 18, 2020, (hereinafter the “SD”) and Normative Resolution of the Board of Directors (hereinafter the “NRD”) No. 102000000006 dated March 27, 2020, issued by National Tax Administration, in order to regulate tax aspects and also extend deadlines of formal and material obligations for taxpayers.
As a consequence, with the objective of implementing the aforementioned actions, the SD was issued establishing the following provisions:
|2||Payment facilities and deferral of the Corporate Income Tax (“IUE”, by its acronym in Spanish) of the fiscal year closed as of December 31, 2019.||New Deadline: May 29, 2020.
Taxpayers subject to the tax will be able to pay the IUE of the year closed as of December 31, 2019, through payment facilities of three (3) monthly installments, without the application of maintenance of value and interests, nor the constitution of securities. This benefit will proceed when the taxpayer pays fifty percent (50%) of the determined tax before June 1, 2020.
|3||IUE cash payment – Whoever, until May 15, 2020, pays in cash the IUE for the year closed as of December 31, 2019, will be able to deduct this as part payment of the Transactions Tax (“IT”, by its acronym in Spanish), in the following proportion.
The IUE is not deductible against the payments of IT that must be paid for the onerous or free transfer of goods and rights.
|4||IUE deduction of Donations for Health Hospitals Centers||Cash donations made until December 31, 2020, in favor of public and/or private Health Hospital Centers, authorized by the Health Ministry (provided they are intended for prevention, diagnosis, control, care and treatment of patients in front of the COVID-19 emergency throughout national territory) will be deductible for the 2020 tax period IUE determination, as long as they do not exceed ten percent (10%) of the net taxable income obtained from January 1, until December 31, 2020.
The deduction will be supported with a document that confirms the donation reception and conformity of the benefited health hospital center, which will appear in the accounting records of the donor and benefited entity.
|5||Tax credit for the Value Added Tax (“IVA” in Spanish) for Independent Professionals.||Until December 31, 2020, the computable IVA tax credit for independent professionals includes the originated in the purchase of food, and the contracting of health and education services of their direct family nucleus.|
|6||IT Taxable Base||During a three (3) month period, for the General Regime taxpayers categorized as Large Taxpayers – GRACO and Main Taxpayers – PRICO, and during a six (6) month period for the taxpayers of the Rest category, the effectively paid IVA will not be a part of the gross income that constitutes the IT Taxable Base.|
Likewise, to implement the aforementioned actions contained in the SD, the National Tax Administration established in the RND the following provisions:
|1||Extend the declaration and/or payment of monthly tax obligations for the February and March 2020 tax periods.||To be fulfilled along with May obligations up to the due dates set forth for April 2020 tax period, pursuant to the last digit of the tax identification number (NIT, by its acronym in Spanish).|
|2||Installment payment of payment facilities plans that have expired on February 28, 2020, and the ones that will end on March 31, 2020.||Up to April 30, 2020.|
|3||Tax Refund Requests (“CEDEIM”, by its acronym in Spanish) submissions ending in March 2020.||Up to April 30, 2020.|
|4||Tax Credit Notes Certificates (“CENOCREF”, by its acronym in Spanish) submissions pursuant to Law No. 1886, ending in March 2020.||Up to April 30, 2020.|
|5||Formal obligations fulfillments such as submitting the IVA Purchase and Sales Book, Information Agents and others established on the specific regulation, ending during the months of March and April 2020.||Up to May 11, 2020.|
|6||Simplified Tax Regime Obligations for the January and February 2020, bimester.||Up to May 11, 2020.|
|7||Tax Affidavit submission, tax payment and formal obligations fulfillment of the Integrated Tax System (“STI” in Spanish) for the March 2020, tax period (trimester between January, February and March 2020).||Up to May 29, 2020.|
|8||Tax Affidavit submission, tax payment and formal obligations fulfillment of the Complementary Regime to the Value Added Tax – Direct Taxpayer (“RC-IVA CD” in Spanish) for the March 2020, tax period (trimester between January, February and March 2020).||Up to May 29, 2020.|
|9||Tax Affidavit submission (Form 500, 510 and 501) for the Business Profit Tax (“IUE”) for the companies with year closure on December 31, 2019. Also, the digital and physical submission of Financial Statements, Annual Report, Complementary Tax Information, Transfer Prices Information and submission of Electronic Form F-110 v.3 (taxpayers who exercise liberal professions and occupations) as the case may be, that required to be submitted to the Tax Administration.||Up to May 29, 2020.|
Likewise, the term computation for the submission and processing of tax proceedings substantiated in the administrative courts (before the General and Regional Tax Challenge Authorities), as well as judicial proceedings (Tax Court Judges), is suspended. Similarly, the term computation for the initiation and processing of determinative and sanctioning proceedings under the control of National Tax Administration and the National Customs Administration is suspended, the terms for notifications of Determinative, Sanctioning, Administrative Resolutions and other challengeable final acts, are specifically suspended. The inspections and verifications scheduled by the tax administrations are exempted from the scope of this paragraph. The computation for suspended terms will restart automatically on the next business day after the Health Emergency Declaration is abolished.
Also, the aforementioned dates and extensions may be subject to changes in case the National Health Emergency and Total Quarantine throughout the Bolivian territory is extended beyond April 15.