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Chile considers COVID VAT rate cuts

Chile is planning to introduce more differentiated VAT rates to support its population during the ongoing COVID-19 emergency; meaning more categorisation of goods or services under the reduced VAT rates.

Currently, most goods and services are subject to the standard Value Added Tax rate of 19%. There are the common exemptions for exports and culture/sport events. The new proposals would including cutting:

  • Bread and milk to 4% until 31 December 2022
  • Healthcare, fuel and hotel accommodation services to 10% until 31 December 2022

The cuts would mean a potential drop in revenues of €8billion up until the end of 2022.

Chile has made a number of payment and returns delays for COVID-19 emergency in 2020.

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