Venezuela - Other taxes and levies

Venezuela - Other taxes and levies

Taxation of international executives

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Social security tax

Are there social security/social insurance taxes in Venezuela? If so, what are the rates for employers and employees?

Employer and employee

Foreigners who reside and work in Venezuela are subject to the mandatory Venezuelan Social Security. The Social Security Contribution is withheld from the monthly salary, based on a ceiling of VEF 75.255, 75 per month (5 monthly minimum salaries), which currently vary several times a year.

Non-resident foreigners working under dependent relationship in Venezuela are likely to be subject to the social security withholdings.

Social security benefits take the form of comprehensive assistance and monetary payments, under the provisions of the Social Law and its regulations. That Law covers social security protection for beneficiaries in cases of maternity, old age, survivorship, sickness, accident, disability, death, retirement, dismissal, and unemployment.

  Employer Employee Total
Minimum risk 11.0% 4.0% 13.0%
Intermediate risk 12.0% 4.0% 14.0%
Maximum risk 13.0% 4.0% 15.0%

Unemployment compensation

This benefit extends to all employees insured by the Venezuelan Social Security Institute (IVSS) who lose their jobs and are able and willing to work.

Employers and employees must make monthly contributions to the unemployment compensation fund, based on the following percentages applied on a maximum ceiling of VEF 150.051,15 per month (10 monthly minimum salaries), which currently vary several times a year.

Employer Employee Total
2.0% 0.5% 2.5%

Gift, wealth, estate, and/or inheritance tax

Are there any gift, wealth, estate, and/or inheritance taxes in Venezuela?

In Venezuela, taxes are imposed on the transmission of property to beneficiaries domiciled in Venezuela or to non-residents in respect of property located in Venezuela. Each taxable beneficiary must compute and pay tax on his/her inheritance or gift. Rates vary, depending on the amount of the inheritance or gift and on the degree of family relationship to the decedent or donor, from 1 percent to 55 percent.

Real estate tax

Are there real estate taxes in Venezuela?

Real Estate taxes are imposed by the autonomous municipality on which the property is located. These taxes are paid by the owner; the rates vary depending on the Municipality based on market values, generally from 1/1,000 to 5/1,000.

Sales/VAT tax

Are there sales and/or value-added taxes in Venezuela?

Value-added tax (VAT) is applicable to economic agents. The tax is levied at 12 percent. The following categories of taxpayers are subject to VAT:

  • individuals or companies usually selling tangible goods
  • importers of tangible goods and services
  • individuals or companies usually performing services of an independent nature
  • public agencies or enterprises owned by the nation, the states, municipalities or independent public institutions which usually conduct taxable activities as well as occasional taxpayers, the latter being importers of goods or services not falling into any of the preceding categories.

The following taxpayers are not subject to VAT:

  • persons with sales or rendering services worth less than 3,000 tax units (VEF228,000) in the preceding calendar year or the year nearest the date on which they commenced their activities
  • persons who only sell goods or render services which are exempt from this tax.

The obligation to pay VAT arises from the following activities:

  • sales and removal or retirement of tangible personal goods located in the country or nationalized
  • permanent importation of tangible goods
  • importation of services to be used in the country
  • rendering of services in the country on an independent basis.

These activities are taxable as follows:

  • in relation to sales of tangible goods, when the invoice or equivalent document is issued to record the transaction, when paid, or when the goods are delivered, whichever comes first
  • in relation to permanent importation of goods and services, when they are nationalized
  • in relation to rendering of services, when the invoice is issued, the service is completed, or total or partial payment is made.

Unemployment tax

Are there unemployment taxes in Venezuela?

See unemployment compensation in the social security section.

Other taxes

Are there additional taxes1 in Venezuela that may be relevant to the general assignee? For example, customs tax, excise tax, stamp tax, and so on.  

Housing loan regime

The housing policy law is a legal tool by which the government seeks to meet the housing needs of Venezuelan Families, and particularly those of lower-income families. All Venezuelans, foreigners actively contributing, which their monthly salary is lower than 150 tax units, are potential beneficiaries.

Employers and employees are required to pay contributions to the Housing Policy Fund, during the first five business days of every month, based on the following percentages of each employee’s monthly salary. Although it is not clear from doubt, it is possible to interpret the taxable base for this tax should be capped at the normal salary.

Employer Employee Total
2.0% 1.0% 3.0%

National institute of socialist capacitating and education (INCES)

Within the first five days of each quarter, the employer must deposit the equivalent of 2 percent of the total amount of wages, salaries and compensation of any other kind paid to persons who work in industrial or commercial establishments not owned by the Nation, the States or the Municipalities. Employers are also required to withhold 0.5 percent of annual profit sharing payments to workers for this purpose.

State taxes

Currently, there are no state taxes imposed on the income of individuals in Venezuela.


Venezuelan employees2

The Law requires that at least 90 percent of white and blue-collar employees (calculated separately) have to be Venezuelan citizens. Moreover, no more than 20 percent of the salaries and other compensation paid to each group can be earned by foreigners, although the Labor Government Office in special cases can modify this percentage. Certain occupations, including those of commanding airplanes or ships can only be practiced by Venezuelans.

Fiscal information register3

All individuals engaged in economic activities in Venezuela must make a registration with the Fiscal Information Registry (RIF), within the first 25 days of doing business in Venezuela. This registration must be updated every three years.

Special taxpayer4

For the 2016 tax year, individuals that earned in the previous year more than VEF 1.327.500,00 (7,500 tax units); are to be considered special taxpayers subject to a severe control compliance and closer review process from the tax authorities.

Migration law5

This Law is aimed at ruling issues relating to the entrance, permanence, registration and control of foreigners in the territory of the Republic, as well as their rights and obligations. Provisions set forth in this Law will be applicable to foreigners in the national territory regardless of their migratory condition, except for diplomatic representatives, without prejudice to provisions set forth in International Law standards and integration treaties and agreements subscribed and ratified by the Republic.

The Law establishes different categories of foreigners for which the regulation –that shall be dictated within the 60 days following the publication of this legal text- will establish the requirements and procedures relating to their entrance, permanence, departure and re-entrance to the national territory. For the moment, the sole indispensable requirements referred to in the regulation are valid passports and visa, where applicable.

Categories referred to in the Law are as follows.

  • Non-migrants: those entering the territory of the Republic for periods of 90 days, as a maximum, with no interest in obtaining a permanent domicile for them or their families, and not allowed, therefore, to exercise activities involving remuneration or profits.
  • Temporary migrants: those entering the territory of the Republic for the purpose of residing in the country during the development of activities that gave rise to their admission in the country.
  • Permanent migrants: those authorized to stay indefinitely in the Republic’s territory.

Likewise, the Law provides for a number of reasons for non-admission of foreigners in the national territory.

  • If the foreigner’s presence triggers alteration of the internal public order or jeopardizes the Republic’s international relationships due to the fact that the foreigner is wanted by police or judicial foreign authorities for common penal reasons, or is involved with national and international crime organizations.
  • If the foreigner has been expelled from the Republic’s territory and the prohibition against entering the country remains effective.
  • If the foreigner has committed a crime typified and punished under the Venezuelan laws to the extent that the foreigner has not served the sentence or the action or sanction in its country of origin has prescribed
  • If the foreigner is involved in any violation of Human Rights, International Humanitarian Rights or provisions set forth in international instruments to which the Republic is a party.
  • If the foreigner is involved in stupefacient or psychotropic substances trafficking or any related activities.
  • If the foreigner suffers from infectious-contagious diseases or other diseases jeopardizing the public health.

The new law clearly states as well that those places enabled for access by foreigners may be closed only in case of emergencies or proven need, temporarily and through sufficiently motivated acts considering both the facts and the related law, dictated in conformity with special standards on exception situations.

Additionally, a series of duties are established for foreigners, including the obligation of registration with the National Registry of Foreigners within the 30 days following their arrival if entering the Republic’s territory as temporary migrants or falling under the category of permanent migrant.

The right to the effective judicial custody in acts concerning foreigners, as to their condition as such, may be considered as a novelty as to its express establishment.

Those persons required to enter the Republic’s territory under a labor contract shall obtain a labor authorization from the Ministry of Work. The procedure to obtain the corresponding authorization shall be performed by the foreigner through his/her contractor in the national territory. The following persons are exempted from this obligation.

  • Scientists, professionals, technicians, experts and specialized personnel coming into the country to offer training courses or to conduct temporary tasks for a period of time not exceeding 90 days.
  • Technicians and professionals invited by public or private entities to comply with academic, scientific or research-related activities to the extent that such activities will not take more than 90 days.
  • Those entering the Republic’s territory to develop activities under cooperation and technical assistance covenants.
  • Mass media professionals from other countries, duly accredited.
  • The members of international scientific missions conducting research works in the Republic’s territory authorized by the Venezuelan government.

The visa authorizing the permanence of the foreigners in the Republic’s territory shall be valid for the same duration period of the labor authorization, and may be renewed provided that the same circumstances giving rise to the granting of the visa will prevail.

The new set of standards establish that employers hiring foreigners shall request their identification documents and notify in writing to a National Registry of Foreigners, created by the law as well, the terms and conditions of the labor relationship as well as the termination of such relationship within the 30 days following the respective event. Likewise, the owners or administrators of hotels and transportation companies shall submit to the aforementioned Registry data on their foreign customers every eight days.

Employers or contractors of foreign workers shall assume a commitment with the relevant authority to pay for the return ticket of the foreigner and his/her family back to their country of origin or last residence within the month following the termination of the contract.

In the event of non-compliance with obligations set forth in this Law, the relevant ministry on foreigners and migration-related matters will be empowered to dictate the necessary measures of warning, fines or deportation from the territory. The right of those subject to the measure of deportation to receive salaries, severance indemnities and all of benefits set forth in the laws governing the labor relationships and collective contracts as well as other social laws is exempted.

Penalties and sanctions-related standards establish, among others, the following.

  • As to employers, fines of 200 tax units for those hiring foreigners illegally.
  • Those facilitating or allowing the illegal access to the Republic’s territory by foreigners will be punished with prison for 4 to 8 years.
  • The same penalty shall be applied to those hiring foreigners living in the Republic’s territory illegally for the purpose of exploiting them as labor under conditions damaging, suppressing or restricting labor rights recognized under legal provisions, collective agreements or individual contracts.
  • The same sanction will be applied to those that faking a contract or employment or by using similar deceitful means, will determine or favor a person’s emigration to another country.
  • For events attributed to companies, the corresponding sanction shall be applied to administrators or service in charge that have been responsible for such events and that knowing them and being able to correct them have failed to adopt the measures required to that end.
  • Those promoting or favoring through any means the illegal immigration to the Republic’s territory shall be sanctioned with prison for 4 to 8 years.
  • Individuals and companies’ representatives who, through action or omission, will promote or mediate the illegal trafficking of persons from, in transit or to the Republic’s territory shall be sanctioned with prison for 4 to 8 years.
  • Those acting as described in article 56 of this Law for a profit or by using violence, intimidation, deceive or taking advantage of the needs of the victim, the victim’s gender or vulnerable groups will be sanctioned with prison from 8 up to 10 years.

Foot Notes

1Additional tax information is summarized by Alcaraz Cabrera Vázquez, the Venezuelan member firm of KPMG International, based on the Social Security, Housing Policy and the National Institute of Educational Cooperation Laws and its corresponding Regulations.

2Article 27 of the Venezuelan Organic Labour Law (Official Gazette No.5.152 dated 19 June 1997).

3Article 99 of the Venezuelan Income Tax Law (Official Gazette No.5.566 dated 28 December 2001).

4Special taxpayers Providence No.296, Official Gazette No.37.970 dated 30 June 2004.

5Immigration Law, Official Gazette No.37.944 dated 24 May 2004 (no web site available).

© 2016 Rodrguez Velazquez & Asociados, a Venezuela partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

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