Tax News Update    Email this document    Print this document  

January 3, 2023
2023-0008

Uruguay introduces zero VAT rate on hotel-related services to resident tourists for the summer season

  • The new zero Value Added Tax (VAT) rate will apply for hotel-related services provided to resident tourists throughout the summer season.

Uruguay's Law N°20,098, enacted on 12 December 2022, establishes that lodging-related services rendered to resident tourists will be subject to a 0% VAT rate (treatment that already applies for nonresidents) until 28 February 2023, provided that the followings conditions are met:

  • The taxpayer must be registered on the Ministry of Tourism as a hotel, apart hotel, motel, hostel, rural establishment, or similar establishment.
  • The taxpayer's annual income, in the last fiscal year closed prior to the entry into force of this bill, does not exceed 10,000,000 indexed units (US$1,430,000 approx.). Decree N°410/022 issued by the Executive Power on 23 December 2022, clarifies the type of income that should be taken into account, confirming that income from hotel services and all of those services charged to the guest, except from restaurant services, should be considered.

Law N°20,098, published on 14 December 2022, in the Official Gazette, can be accessed here, and is effective since its date of enactment. Decree N°410/022, which has not been published yet, can be access here.

____________________________

For additional information with respect to this Alert, please contact the following:

EY Uruguay, Montevideo

Ernst & Young LLP (United States), Latin American Business Center, New York

Ernst & Young LLP (United Kingdom), Latin American Business Center, London

Ernst & Young Tax Co., Latin American Business Center, Japan & Asia Pacific

 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 1996 – 2024, Ernst & Young LLP

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

EY US Tax News Update Master Agreement | EY Privacy Statement