Chile has confirmed that software sold by non-resident providers to Chilean buyers is subject to Value Added Tax.
Chile imposed 19% VAT on foreign sourced digital services in June 2020. This included downloaded software, gaming, online advertising etc. It did provide a simplified VAT registration service, with no right to deduct any local VAT incurred.
The tax office has now reconfirmed that software licenses are not subject to withholding tax, and so is therefore liable to VAT. This obliges the providers to VAT register and provide a sales invoice.
You can check the right VAT calculations on individual or batch transactions with our Advisor and Auditor services.
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Central and South America VAT on digital services
| Comments (click for details) | Rate | Date | Threshold | Comments |
| Argentina | 21% | Apr 2018 | – | |
| Aruba | 4% | Jan 2023 | - | |
| Bahamas | 10% | Jan 2015 | BSD 100,000 | |
| Barbados | 17.5% | Dec 2019 | BBD 200,000 | |
| Bolivia | 13% | Nov 2022 | - | |
| Brazil | n/a | n/a | n/a | Various proposals |
| Chile | 19% | Jun 2020 | Nil | |
| Colombia | 19% | Jan-18 | Nil | |
| Costa Rica | 13% | Oct 2020 | Nil | Withholding VAT option |
| Dominican Republic | 18% | 2023 | Nil | Currently withholding VAT |
| Ecuador | 12% | Sep 2020 | – | |
| El Salvador | 13% | 2022 | - | Replace Withholding VAT |
| Guatemala | 12% | TBC | ||
| Honduras | 15% | 2022 | HNL 250,000 | |
| Panama | 10% | 2022 | Withholding VAT | |
| Paraguay | 10% | Jan-21 | Nil | Withholding VAT; 4.5% DST |
| Peru | 18% | 2022 | Nil | Withholding VAT |
| Puerto Rico | 10.5% | Jan 2020 | $100,000; or 200 transactions | Marketplaces |
| Suriname | 10% | Jan 2023 | SRD 500,000 | |
| Uruguay | 22% | Jan 2018 | Nil | VAT and Withholding Tax |
