Bolivia: Tax & Auditing Requirements

Businesses in Bolivia are subject to paying the following taxes:

  • Value Added Tax (VAT): A sales tax. Unlike other countries, in Bolivia VAT is included in the price of goods and services and is 13%.
  • Tax on Company Profits (IUE): This is a tax on profits declared in company financial statements, and it is equivalent to 25% of the net profits of each annual management as of December 31st of each year. In the case of branches, it is assumed that all income will be sent to the foreign headquarters, so in addition to the IUE, branches must pay 12.5% of the total amount remitted abroad.
  • Transaction Tax (IT): This is a direct tax of 3% on gross income earned in each fiscal period and paid for each fiscal period.
  • Financial Transaction Tax: This taxes the operations in foreign and domestic currency with value maintenance, with the rate of $1.5 USD per transaction of $1,000 USD or its equivalent in national currency with value maintenance.
  • Property and Vehicle Tax: Companies that possess real estate or vehicles are subject to this tax, with the tax base valued by each municipality and supervised by local governments and the National Tax Service. This tax is paid annually, and it depends on the location of the property as well as other factors.
  • Real Estate and Vehicles Municipal Tax: Any transfers of property and motor vehicles are taxed. Taxable income is 3% of the value of the transfer and only applies when the company sells property or a vehicle to a third party.

Bolivia has signed international agreements to avoid double taxation with Argentina, Germany, the UK, Spain, Sweden, and France. Bolivia is also part of the Andean Community, an international organization that avoids double taxation between member countries (Colombia, Peru, Ecuador, Bolivia, and Venezuela).

Foreign employees are subject to the same taxes as local employees but are exempt from social security contributions.


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