Contact Us
Bolivia
Corporate - Tax credits and incentives
Last reviewed - 20 January 2025Foreign tax credit
Bolivian legislation does not include provisions regarding recognition of foreign tax credits.
Investment incentives
Law 1613 establishes tax incentives in connection with the total or partial reinvestment of profits/dividends obtained in Bolivia through a reduced withholding tax rate of:
- 3.125% for reinvestments equal to or greater than 75% of the profit/dividend;
-
6.25% for reinvestments between 50% and 74.99% of the profit/dividend; and
-
11.25% for reinvestments between 25% and 49.99% of the profit/dividend.
Export incentives
Export activities benefit from reimbursement of VAT and customs duties paid in the process of producing goods to be exported (with some limitations for oil/gas companies).
Other incentives
Foreign exchange transactions are legal in Bolivia, and a system of free-floating exchange rates exists, although, in practice, the US dollar has had an official fixed exchange rate published by the Bolivian Central Bank for approximately the last ten years.
Tourist and lodging services by hotels to foreign tourists without a residence or address in the country are exempt from VAT. In addition, importation of books, magazines, and newspapers are exempted from importation taxes (i.e. VAT), and the sale of produced or imported books are taxed at the zero VAT rate.
International transportation by highway is also exempt from VAT (or subject to 0% VAT rate).
The provision of legal, financial, and other advisory services related to the operation of public debt in external capital markets and carbon market operations are are exempted from CIT.
Domestic sales of soybean, cusi, totaí and other cultivated or wild species and/or their derivatives, exclusively inteded to produce biodiesel and/or ecological diesel for Yacimientos Petrolíferos Fiscales Bolivianos (YPFB) plants (i.e. exemption of payment of Transaction Tax and application of a zero-rate VAT in respect of local sales).
Regional manufacturing tax incentives
New investments (excluding services and commerce) and expansions of existing investments in the city of El Alto (Department of La Paz) will be eligible for the following benefits provided the Municipal Government of El Alto approves the investment proposal submitted by the investors and asset retention within El Alto for up to 20 years (10 years under CIT exemption and an additional 10 years without benefits).
| Exemption |Benefit | Conditions of exemption |
| Import tariffs and VAT on imported machinery | Machinery imported not produced locally for up to 2 years. |
| Import tariffs on imported inputs and equipment | A single 3% payment under USD3,000 via ZOFRACENTRO (El Alto Free Zone), applicable to inputs and equipment for new production processes that are not produced in Bolivia. |
| CIT | Up to 10 years, provided the exempted CIT amount is reinvested in full within the next fiscal year in capital goods or job creation |
| Property Tax on Real Estate | For up to 3 years on new constructions used for industries or hotels, contingent on starting operations within one year according to the criteria of the Municipal Government of El Alto. |
| Municipal Tax |
Discounts up to 25% for urban or neighbourhood improvement projects coordinated with the local government. |
New investments in manufacturing in the states of Oruro and Potosi are entitled to the following tax exemptions:
| Exemption | Conditions of exemption |
| Import tariffs and VAT on imported machinery | Machinery imported exclusively for the new industry until start-up of operations. |
| Import tariffs on imported inputs | They do not replace domestic inputs of the same kind and are destined to a transformation process. The exemption is granted for the first ten years of operation. |
| Transaction tax | For ten years from the start-up of operations. |
| CIT | For ten years from the start-up of operations if the amount exempt is reinvested in fixed assets in the following fiscal year. |
| Property Tax on Real Estate |
On constructions and buildings made for its operation for a period not exceeding three years, starting from the commencement of production. |
Bolivia contacts
Bolivia contacts
Bolivia News
