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New VAT Refund Regime Aims to Promote Peruvian Tourism

2 Oct 2012


This article has been republished in Thomson Reuters' Practical Latin American Tax Strategies, November 2012

A VAT refund regime applicable to foreign tourists has recently been introduced to the Peruvian tax system. This refund will apply to the acquisitions of goods within Peruvian territory that will be recouped when tourists are returning to their home countries. Taxand Peru investigates the details of the new VAT regime and its potential impact on Peruvian tourism.

According to the new regulations, foreign tourists staying in Peru for a duration of between 5 and 60 calendar days may benefit from the VAT refund when buying goods of a minimum price of S/.50 each (approximately US$20) where the refund requested is of at least S/.100 (US$39).

For the refund to apply, the goods must be acquired from stores duly registered with the Tax Administration (SUNAT) using a credit card or a debit card. A 'Tax Free' certificate issued by the store must be granted to the buyer for each invoice issued. The certificate must include, among other information, the tourist's name, his / her nationality, and the number of the credit or debit card certificate used for the acquisition.

While specific procedure regulations are still pending, it has been established that the application for the refund, along with the required documentation (including the 'Tax Free' certificate), must be filed before SUNAT prior to the departure of the tourist. SUNAT has a 60 day period to approve the refund, which will be made directly to the credit or debit card used for the acquisition.


Taxand's Take

Although the VAT law has always allowed the VAT refund for tourists, this is the first time such a benefit has been regulated in order to make it effective. With this new regulation, Peru aims to promote tourism and catch up with other countries in South America, such as Argentina and Colombia, that already apply the refund.

Your Taxand contact for further queries is:
Pablo Sotomayor
T. 511 610 4747

This article has been republished in Thomson Reuters' Practical Latin American Tax Strategies, November 2012

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Taxand's Take Author