SURINAME: Update on the draft VAT act
August 18, 2022
Update on the draft VAT Act
As you already may know the Surinamese government intends to introduce and implement the Value Added Tax (‘VAT’) per January 1, 2023. So far, the draft VAT Act mentions a general VAT rate of 15 percent.
In the last few weeks, the Surinamese tax authorities have held many meetings with different stakeholders about the draft VAT Act. The parliamentary debates have also started. It’s not clear at this moment how long this process will take before the Act will be approved.
The focus has been on the feasibility and the many practical issues entrepreneurs will face when the VAT Act is introduced. An advice committee to the National Assembly has been formed. Also, technical issues in the draft VAT Act have been discussed, as well during the debates in Parliament. We understand that the proposed bill already has undergone several changes. The latest version which actually is a work document, is from August 1st. Hereinafter, we will share with you the latest highlights of the upcoming VAT.
Relevant highlights recent draft VAT Act
- One of the main concerns during the meetings with the stakeholders was the settlement arrangement without a VAT refund. In some cases the long VAT refund procedure was the biggest concern. A refund will result in case the input VAT will be more than the output VAT in a tax period. The draft VAT Act from August 1st now has the VAT refund possibility that includes a more simplified procedure; however the practical application remains the biggest concern.
- Upon request a fiscal unity can be formed for VAT purposes. This means that entrepreneurs with multiple businesses that are connected financially and economically, can request to be considered as one entrepreneur for VAT purposes. This possibility will have advantages, such as less administrative obligations for group companies. As well as a VAT refund of a ‘connected’ company within the fiscal unity will be settled against the VAT due.
- As stated above, the National Assembly has now started discussions about the VAT. In the public meeting of the National Assembly on August 11, the Minister of Finance confirmed that:
- The proposed rate of 15 percent is up for discussion. We understand that a percentage between 10% and 15% will be considered.
- The registration process of the taxpayers (the entrepreneurs) will take place online; however, it will still be possible to register in person.
- Important to mention is that the Minister of Finance has submitted his resignation, as of September 2022. It’s not clear if this announcement will delay the process for approving the VAT.
We trust that this short update has provided you with relevant information. For now, it’s important to follow the discussions and we will update you in case of important amendments.
Contacts
Siegfried Kenswil
siegfried.kenswil@hbnlawtax.com
Nazna Ishaak
nazna.ishaak@hbnlawtax.com
Akash Gobardhan
akash.gobardhan@hbnlawtax.com
Cheryl Leeflang
cheryl.leeflang@hbnlawtax.com