Chile
At the end of October, the Chilean Congress enacted the Tax Compliance Bill (Proyecto de Ley de Cumplimiento de las Obligaciones Tributarias), introducing VAT on low-value consignments of goods being imported by consumers.
Currently, an Import VAT exemption threshold of $41 (approx. £32) allows consumers to purchase goods from non-resident companies free of VAT up to this value. However, this threshold will now be removed. Instead, non-resident providers will be obliged to VAT register and charge VAT to consumers at the current rate of 19% on consignments valued at or below $500 (approx. £395).
The Chilean authorities have confirmed that:
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There will be no VAT registration threshold for non-resident sellers.
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A simplified registration scheme will be implemented for affected businesses.
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Where suppliers fail to register, payment service providers (e.g., credit card companies) will be required to withhold VAT on payments made by consumers.
This measure aligns with similar VAT rules introduced for digital supplies.
Philippines
In October 2024, President Ferdinand Marcos Jr. of the Philippines signed into law Senate No. 2528 , introducing VAT on digital services provided by foreign providers to local consumers.
While no specific implementation date has been announced, the earliest launch date for this new regime is confirmed as June 2025. The Philippines Bureau of Internal Revenue (BIR) also clarified that non-resident providers will not need to engage a local tax agent to register for VAT in the country.
Currently, foreign businesses providing digital services to Philippine consumers do not charge VAT on their sales. To address the competitive advantage this gives non-resident companies over local providers, the government plans to impose a 12% VAT on these transactions.
The VAT will apply to a range of electronic services, including:
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Online advertisement services.
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Streaming games, music, films and apps.
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E-books and e-journals.
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Internet services.
Zanzibar
Zanzibar, has introduced VAT at 15% on the supply of digital services to consumers by non-resident providers.
Implemented in August 2024, this new tax replaces the previous exemption that allowed foreign businesses to provide digital services without charging VAT. The change aims to address the competitive imbalance between non-resident and local providers by requiring VAT to be charged at 15% on these transactions.
The VAT applies to a broad range of electronic services, including:
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Software.
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Streaming games, music, films and apps.
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E-books and e-journals.
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Internet services.
The above news was kindly provided by Fiscal Solutions (UK), www.fiscalsolutions.co.uk; contact: [email protected].
