New Tax Law in Effect in Honduras

The recently published new legislation establishes an increase of 12% to 15% in sales tax.

Monday, January 6, 2014

The Law on Ordering Public Finance, Control of Exemptions and Antievasion Measures includes 72 foods which had been excluded from payment of Sales Tax (ISV by its initials in Spanish) among which are ribs of beef, pork, chicken, natural cows milk, pasteurized milk, whole milk powder, butter and others.

However, some products such as vegetable oils for cooking and a large quantity of milk derived from cow's milk will incur ISV. "... It impacts micro and small enterprises engaged in the baking and pastry sectors because of the vast amount of products they market which incur Sales Tax", reported Laprensa.hn.

Aline Flores, president of the Honduran Council of Private Enterprise, has asked Congress to reconsider taxes on fuels and various products in the basic basket. The State intends to raise $114 million with the new tax on petroleum products.

Some of the businesses operating in the Honduran capital already applying the ISV 15% on all products, however, there is still confusion about how to collect the tax as some billing systems do not allow for it.



More on this topic

Honduras: Conflict Over Withholding of Sales Tax

February 2017

A resolution by the tax authorities establishes that withholding of sales tax will from now on be done by the card issuer, and not the trader.

The business sector has stated that this was not what was decided together with President Hernandez when the scope and characteristics of the new Tax Code were defined and is asking for the resolution by the SAR to be declared invalid and for retention to once again be made by traders.

New List of Products Exempt from VAT

May 2012

In Costa Rica, the Ministry of Finance has published a new list of products exempt from the basic VAT of 13%.

The Ministry of Finance has decided to include in the list of exemptions meats such as steaks, ground beef, sirloin tip, brisket, liver and tongue, and others.

Also exempted is honey, fish, other than those consumed by higher income sectors, such as tuna filets, cod and salmon, reported Nacion.com.

Tax Review of Basic Food Products

May 2012

Costa Rica's government has amended a decree issued last week which levies with a tax of 13% products like wheat flour bread, milk and packaged beans .

Besides the aforementioned products, others that remain exempt from the 13% Sales Tax (IV in Spanish) include tinned tuna, with or without vegetables, sausages packed in sealed plastic, and cheese packaged in sealed plastic without any degree of maturation.

Tax Exemption Ends for 90 Products

May 2012

Due to the government’s need to increase tax revenue in Costa Rica several types of meat and fruit will incur sales tax of 13% from Monday .

Among the types of products that will be taxed from now on with 13% sales tax are beef and pork loins, beef tenderloin and pork t-bone, Delmonico, sirloin, salmon, rice paella, risotto, shrimp, lobster, oysters, kiwi, plums, prunes, cherries and peaches, reports Nacion.com.

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Tabora & Flores, Auditores y Consultores, SRL

Audit and general consulting services
Operates in Honduras
Phone: (504) 557 6411 - (504) 557 5604

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