Chile Tax Agency Clarifies VAT on Services Provided From Abroad Under 2007 DTA With Colombia

The Chilean Internal Revenue Service Nov. 16 issued Letter No. 2848, clarifying the taxation of collection management services and support activities provided by a Colombian company to a Chilean collection management company, under the 2007 DTA with Colombia. The Colombian company issued invoices in dollars, exempt from VAT. The company sought a clarification on the tax effects of its activities under the sales tax law. The Tax Agency clarified that: 1) under the Sales and Services Tax Law (LIVS), the services in question would generally be subject to VAT; 2) an additional 35 percent tax rate would apply under the ...