What is the IGV exemption | Economy | Taxes | Peru | nnda-nnlt | YOUR MONEY

What is the IGV exemption | Economy | Taxes | Peru | nnda-nnlt | YOUR MONEY
What is the IGV exemption | Economy | Taxes | Peru | nnda-nnlt | YOUR MONEY

Lima, 05/10/2022 04:46 pm

Due to the rise in prices of first need products was through the roof, like chicken, bread and sugar, due to external factors, the Peruvian government decided to remove the VAT to a group of products from the basic family basket in order to lower costs. What is it about?

MORE INFORMATION: Ten reasons why the VAT exemption for five foods will have little impact

In April 2022, the full Congress of the Republic approved the opinion that recommends accepting the observations of the Executive Power and establishes the exemption of the general sales tax (IGV) for five products of the basic family basket.

The opinion, which was previously approved in the Economy Commission, was supported by a total of 95 congressmen, while 10 expressed themselves against it and three voted for abstention. What is the end? Let prices drop by the time it reaches the final customer, the homes.

MORE INFORMATION: The Economy Commission approves the VAT exemption for five products only until July of this year

WHAT IS THE IGV EXEMPTION?

The Law that exempts the General Sales Tax (IGV) for food from the basic family basket was created in order to alleviate the rise in basic necessities, as a consequence of the political situation in the country and the war in Russia and Croatia, which brought with it the increase in fuel prices, among others.

The rule indicates that taxpayers may apply as a tax credit the General Sales Tax corresponding to acquisitions and/or imports of the main inputs required in the production process of exempted goods. The measure applies from May 1 and expires on July 31, 2022.

SINCE WHEN DOES THE IGV EXEMPTION WORK?

The measure came into effect from May 1 and will last until July 31, 2022, both for the sale in the country or import of goods that make up the basic family basket.

WHAT PRODUCTS OF THE BASIC FAMILY BASKET ARE EXEMPT FROM THE IGV?

The IGV exemption applies to acquisitions and/or imports of the main inputs required in the production process of the following goods:

  • Fresh, chilled or frozen poultry meat of the species Gallus domesticus.
  • Fresh chicken eggs of the species Gallus domesticus.
  • Sugar.
  • Uncooked pasta, stuffed or otherwise prepared.
  • Bread.

Example: When it is mentioned that the exemption covers products used in the production process, it includes, for example, yeast and wheat flour to make bread; as well as corn to feed the birds.

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The measure is expected to relieve consumer pockets (Photo: GEC)

Peru
The article is in Spanish

Tags: IGV exemption Economy Taxes Peru nndannlt MONEY

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