Caribbean state consults on levying VAT on e-services from non-resident providers and marketplaces
The Caribbean state of the Dominican Repulic is consulting on imposing Value Added Tax on foreign digital or electronic service providers. It would join over 90 other countries that have followed the OECD guidelines on electronic services and VAT on a destination-basis.
The ongoing consultation is looking at imposing VAT registration and monthly reporting on non-resident providers. This would replace the existing withholding VAT obligation where consumers make payments to such providers.
The current VAT rate in the Dominican Republic is 18%. Follow VAT Calc’s global VAT and GST on digital services tracker for live updates on worldwide reforms.
What digital services are subject to Dominican Republic VAT?
Income from the following services is liable to VAT:
- Gaming and games of chance
- E-learning
- Apps
- SaaS or cloud-based software
- Streaming or download software
- Online storage
- Advertising
Determining if VAT is due
Providers could rely on any of the following to determine if the service was consumed in the Dominican Republic, and therefore VAT due:
- IP address
- SIM card address
- Payment from card registered locally
- Billing address
Filing digital services VAT returns
Compiling VAT or GST return can be complex. VAT Calc’s single platform VAT Filer can correctly complete any country filings with verified VAT or GST transactional data from our VAT Calculator or VAT Auditorintegrated tools.
Central and South America VAT on digital services
| Comments (click for details) | Rate | Date | Threshold | Comments |
| Argentina | 21% | Apr 2018 | – | |
| Aruba | 4% | Jan 2023 | - | |
| Bahamas | 10% | Jan 2015 | BSD 100,000 | |
| Barbados | 17.5% | Dec 2019 | BBD 200,000 | |
| Bolivia | 13% | Nov 2022 | - | |
| Brazil | 26.5% | Jan 2026 | n/a | Regulations in parliament |
| Chile | 19% | Jun 2020 | Nil | |
| Colombia | 19% | Jan-18 | Nil | |
| Costa Rica | 13% | Oct 2020 | Nil | Withholding VAT option |
| Curaçao | 6% | 2020 | Nil | |
| Dominican Republic | 18% | 2025 | Nil | Currently withholding VAT |
| Ecuador | 12% | Sep 2020 | – | |
| El Salvador | 13% | 2022 | - | Replace Withholding VAT |
| Guatemala | 12% | TBC | ||
| Honduras | 15% | 2022 | HNL 250,000 | |
| Panama | 10% | 2022 | Withholding VAT | |
| Paraguay | 10% | Jan-21 | Nil | Withholding VAT; 4.5% DST |
| Peru | 18% | 2024 | Nil | Withholding VAT |
| Puerto Rico | 10.5% | Jan 2020 | $100,000; or 200 transactions | Marketplaces |
| Suriname | 10% | Jan 2023 | SRD 500,000 | |
| Uruguay | 22% | Jan 2018 | Nil | VAT and Withholding Tax |
