Revenue Service designates banking institutions as collection agents of tax on large financial transactions 

The National Integrated Service of Customs and Tax Administration ("Revenue Service") issued Administrative Order No. SNAT/2016/0004 ("Order 0004") (Official Gazette No. 40,834 of 22 January 2016), which designated the banking institutions governed by the Law of Banking Institutions and the Law of the Venezuelan Central Bank as collection agents of the tax on large financial transactions ("Financial Tax"), for the transactions that special taxpayers make.

Order 0004 established that in order to collect the Financial Tax on the transfer of checks, securities, escrows paid in cash, and any other negotiable instrument, the collection agents must verify the amount of endorsements or assignments that each check or security has, and charge the taxpayer's account the amount that results from multiplying the Financial Tax's tax rate (e.g., 0.75 percent) by the amount of the check or security. Additionally, the collection agent must multiply the previous result by the amount of endorsements or assignments when the instrument has more than one. The filing stamps to the Banking Clearing House that banking or financial institutions put on checks is not considered as an endorsement or assignment for purposes of the Financial Tax.

In case of the acquisition of cashiers' checks, banking institutions will make the Financial Tax collection from the special taxpayers, through the debit on the acquirer's account at the time the transaction is effective. If the cashier's check is acquired in cash, the banking institutions will make the Financial Tax collection at the time of the check's issuance. Banking institutions must collect the Financial Tax the same day in which the taxable event occurs.

To pay the Financial Tax, in accordance with the provisions of the Technical Instructions that the Revenue Service will publish, the collection agents must:

  1. make a daily transmission at the close of the banking activities;
  2. file a return on the Revenue Service's Website (http://www.seniat.gob.ve) and pay the collected amounts the following business day before the a National Funds Collection Office; and,
  3. each Sunday, file a statement with the detailed information of the collections made.The Venezuelan Central Bank will provide the announcement of the Financial Tax's Concentrating Account credit to the Revenue Service on each business day in accordance with the provisions of the Technical Instructions.

The collection agent may not reverse transactions when it makes an undue collection or pays to the National Treasury amounts in excess of the collected amounts. In those cases, the collection agent must reimburse the taxpayer and request the Revenue Service the reimbursement of the corresponding amounts in accordance with the Organic Tax Code.

Order 0004 entered into force on 1 February 2016, the same date in which the Financial Tax Law entered into force. Failure to comply with the provisions of Order 0004 will be subject to the sanctions provided in the Organic Tax Code.

Rules for filing the return and paying tax on large financial transactions 

The National Integrated Service of Customs and Tax Administration ("Revenue Service") issued Administrative Order No. SNAT/2016/0005 (Official Gazette No. 40,835 of 25 January 2016) ("Order 0005") which establishes the formalities for filing the return and paying the tax on large financial transactions ("Financial Tax").

Taxpayers regulated by Order 0005 are:

  1. legal entities and unincorporated economic entities that the Revenue Service designated as special taxpayers,1 for the payments they make without the intervention of financial institutions;
  2. legal entities and unincorporated economic entities legally, which hold the status of ordinary taxpayers, related to a legal entity or an unincorporated economic entity, designated as a special taxpayer, for the payments that any of the first two entities make on behalf of any of the second two entities with or without the intervention of financial institutions; and,
  3. individuals, legal entities and unincorporated economic entities that, without being legally related to a legal entity or an unincorporated economic entity without legal personality, designated as a special taxpayer, make payments on their behalf, charging their own bank accounts or financial institutions or without intervention of financial institutions. 

Order 0005 defines as related taxpayers "(…)  the entities that participate directly o indirectly in the administration, control or capital of another entity or when the same persons participate directly or indirectly in the administration, control or capital of both entities ". 

Taxpayers governed by Order 0005 must file the return and pay the Financial Tax in accordance with the Special Taxpayers' Calendar for the payment of VAT withholding, issued by the Revenue Service. The Financial Tax return must be filed through the Revenue Service's Web Page (www.seniat.gob.ve).

Taxpayers not designated as special taxpayers must pay the Financial Tax through Banks Recipient of National Funds and taxpayers designated as special taxpayers must pay the Financial Tax, through Public Banking authorized to act as a recipient of  National Funds. Taxpayers governed by Order 0005 must maintain detailed reports of ledger accounts that show the amount of Financial Tax paid, for the use of the Revenue Service.

The breach of the provisions of Order 0005 will be sanctioned in accordance with the Organic Tax Code.

Order 0005 entered into force on 1 February 2016; the same date in which the Law of Tax on Large Financial Transactions entered into force.

Debits to accounts in foreign currency of the National Financial System are subject to 0% Financial Transactions Tax 

Presidential Decree No. 2,212 of 28 January 2016 (hereinafter ''Decree 2,212'') (Official Gazette No. 40,839, of 29 January 2016) established a 0 percent large financial transactions tax rate (''Financial Tax'') for debits made by special taxpayers to accounts in foreign currency of the National Financial System, including the accounts held by the Venezuelan Central Bank, in accordance with the exchange control provisions issued by such entity and the Executive Power at National Level. Decree 2,212 entered into force on 1 February 2016. Although the 0 percent fee is a typical VAT mechanism that allows exporters to recover the input VAT paid upon the purchase or importation of goods and services used in their export activities, for Financial Tax purposes this mechanism turns, in practice, into a tax exemption.

Decree 2,212 designated the Minister of the People's Power of Banking and Finance and the Minister of State for Productive Economy, as responsible of the enforcement of Decree 2,212.