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Argentina Exempts VAT on Hotel Stays

VAT on hotel stays for non-resident tourists to Argentina can be refunded as from 02 January 2017. This levels the playing field for Argentina to compete against other South American countries who exempt VAT for inbound tourist hotel stays.

Last Friday the Government issued a decree to refund VAT on hotel stays to non-resident tourists – a law that has existed for almost 10 years but was never implemented,” said a spokesman for Eurotur – a local inbound tour operator with offices in Buenos Aires, El Calafate, and Ushuaia Patagonia.

According to Eurotur, the decree has generated doubts on how to apply the VAT rebate, and offers the following advice:

Benefits:

  • Applies from January 2nd 2017 for new hotel bookings and depending on each property policies.
  • Applies only to room and breakfast, only if the latter is included in the rate as a whole.
  • Applies only to bookings made directly to the hotel or through Travel Agents & Tour Operators registered by the Argentine Tourism Ministry.
  • Properties that can give this benefit have to be registered by the Tourism Ministry and registered in a specific fiscal category. Other commonly used hotels, hosterias, lodges and estancias, due to a different simplified fiscal category, cannot refund VAT.
  • The amount of the refund, corresponds to the night room rate VAT, as invoiced by the hotel.
  • Only for tourists whose main country of residence is not Argentina. We need to have a copy on file of the passport or foreign ID showing current foreign residence. It is your responsibility to source such documents at the time of booking.
  • Payments must be done by international wire transfer, credit/debit cards (not issued in Argentina). Copy of payment method and details must be kept on file.

Does not apply for:

  • Other services provided by the hotel, such as meals, spa, room extras, or meeting venues, among others. We are still uncertain on how the benefit applies to properties with all inclusive rates.
  • Cancellation charges for any reason. It is important to know, that if a guest cancels and the hotel charges penalties, the cost will be increased with VAT. Eurotur will invoice and collect such increased value.
  • Any type of penalty applied by the hotel, such as attrition in groups. It is important to know, that if hotels charge a penalty, the cost will be increased with VAT. Eurotur will invoice and collect such increased value.
  • Cash payments in any currency, or with any local Argentine payment method.
  • Bookings and collections with accommodation previous to January 2, even if invoicing is done after today.

How it works:

  • In the immediate term, while systems are adjusted and any doubts are clarified with the authorities, we will appreciate your patience to study each case.
  • In the next 48 hours we will have our system and online tariff updated, so that all new files have the benefit included. You will see the note “VAT Refunded”; if not present it will be because the benefit is not applicable by the property for some reason.
  • In the short term, files and invoices will have the benefit always applied, of course subject to the fulfillment of the conditions mentioned before.

“This is very good news as well as an incentive to grow sales to Argentina, even with the delays to instrument caused by the doubts we hope to answer in the next couple of days,” concludes Eurotour.

For more information email the Eurotur Argentina Sales Team <sales@eurotur.tur.ar>