Chile
Chile is proposing to extend its VAT system to impose VAT on low-value consignments of goods being imported directly by consumers.
Currently, there is an Import VAT exemption threshold set at $500 (approx. £400), which allows importers to purchase goods free of VAT from non-resident companies up to this value. However, if accepted, this proposal would lead to this threshold being removed and instead, non-resident providers will have an obligation to charge VAT to the consumers at the current rate of 19% themselves.
This follows similar VAT measures that were introduced on supplies of digital supplies and if introduced there will be via a simplified registration scheme with no VAT registration threshold for non-resident traders.
Thailand
Following a mandate from Prime Minister Srettha Thavisin, the Thai government confirmed that it will remove the low-value goods Import VAT exemption on goods imported from outside the country.
Currently, there is an Import VAT exemption threshold set at Baht 1,500 (approx. £32), which allows importers to purchase goods free of VAT from non-resident companies up to this value. However, from May 2024, this threshold will be removed and instead, non-resident providers will have an obligation to charge VAT to the consumers at the current rate of 7%.
The Thai government hopes to confirm more around how to register as a non-resident company during May and it is widely thought that this will be via a simplified registration scheme with no VAT registration threshold.
Zambia
During February 2024, the Zambian tax authority published the VAT (Cross Border Electronic Services) Regulations, 2024. These regulations clarify that from 1 January 2024, non-resident providers of digital services must register, collect, and remit VAT using a simplified registration system when selling to Zambian consumers.
Previously foreign digital service providers did not have to charge VAT on their sales to consumers in the country. However, to remove the unfair advantage that this gave to non-resident companies over resident providers, the Zambian government introduced VAT at 16% on these types of transactions from January 2024.
Non-resident digital services providers are required to VAT register if they exceed a threshold of ZMW 800,000 (approx. £23,600) per annum or ZMW 200,000 (approx. £5,800) per quarter for sales arising from Zambia. They also need to engage a local Fiscal Representative to VAT register in the country.
This new tax applies to a range of electronic services including advertising, streaming games, music, apps, films, e-books, e-journals, software, and internet services.
The above news was kindly provided by Fiscal Solutions (UK), www.fiscalsolutions.co.uk; contact: [email protected].
