Scope and Rates
The Curaçao turnover tax, also known as “Omzetbelasting” (OB) is comparable with a sales tax.
Curaçao OB is levied on:
- supply of goods in the country
- services provided in the country
- import of goods.
The standard rate of OB is 6 percent.
Certain goods and services are exempt from sales tax with no right to recover input tax, including:
- on request the OB in respect of the goods used for the manufacturing or packaging of goods for export
- the delivery of real property provided that real estate transfer tax is levied
- specific supplies of fuel
- supply of goods and services to oil refineries, used for their operations
- services rendered to companies established in an E-zone
- services rendered to and by companies with a foreign exchange license
- certain services to customers abroad are deemed to be rendered outside Curaçao (non taxable), for instance financial, IT, licensing services and services rendered by E-zone companies, provided that the service is factually enjoyed abroad.
- real estate tax
- excise taxes
- stamp duty & registration duty
- land tax (real estate)
- room tax & casino tax.
Entrepreneurs carrying out a business provided they are collecting revenues from the sale of goods or the rendering of services in Curaçao.
Upon request, entrepreneurs may be exempt from turnover tax provided that the turnover in the preceding year was less than ANG 30,000 (not applicable for real estate leasing activities).
If taxpayers do not follow the registration procedures explained above, there is a penalty depending on the gravity of the case and with percentages ranging between 5 and 100 percent of the tax due with maximum amounts between ANG 2,500 and no limit respectively.
There is no special registry for OB but it is lawful practice to register a taxable foreign company in the Curaçao Taxpayers Registry. As mentioned above, such a registration involves the identification of the relevant taxable person with a valid identification number for all tax purposes (including invoicing, filing tax returns, and other reports to the tax administration).
There are no simplifications.
If an overseas company is registered in the taxpayer’s registry, there will in general not be an obligation to appoint a fiscal representative.
Turnover Tax grouping
Taxpayers are obligated to submit monthly tax returns relating to taxable and exempted operations.
No, there are not.
Generally not applicable but if the reverse charge mechanism is applicable then the daily exchange rate should be used.
Turnover Tax recovery
In general, no.
In general it is not possible to recover OB.
International Supplies of Goods and Services
Export of goods and services performed abroad are not subject to OB.
When goods are imported into Curaçao, import OB and customs duties must be paid before the goods are released from customs control.
Exemptions apply like supplies to inherent vessels or trade products.
Services rendered abroad which are enjoyed in Curaçao (enjoyment of services) are taxable.
If services are rendered to a local entrepreneur and if OB should be due in this scenario, a reverse charge mechanism will in principle apply which means that the local entrepreneur becomes liable for OB in connection with the services rendered by the foreign entrepreneur.
Layout of invoices is strictly regulated. Among others, invoices must contain information about the identity of seller and buyer. In addition, invoices must disclose the price per unit and the OB charged separately from the sales price.
No, to be requested.
No, to be requested.
Transfers of Business
The transfers resulting from business reorganizations (merger or spin-off) or the sale of a (part of) a business are not subject to turnover tax. Transfers of individual assets however are taxable.
Options to Tax
Head Office and Branch transactions
There are no special rules for OB, since both are considered as different taxpayers for OB purposes.
There are no specific anti-avoidance rules in Curaçao legislation.
There are certain penalties for failing to fulfill formal obligations (late registration, mistaken declaration of OB, late submission of an OB return and other irregularities).
How often do tax audits take place?
Once every 5 years.
Are there audits done electronically in your country (e-audit)? If so, what system is in use?
Is it possible to apply for formal or informal advance rulings from the (indirect) tax authority?
Not in general.
Are rulings and decisions issued by the tax authorities publicly available in your country?
N/A for rulings.
In general there is no right for entrepreneurs to claim deduction of turnover tax paid.
- E-zone: exemption from sales tax on services rendered to companies established in the E-zone and services rendered by these companies to customers abroad.
- Exemption from sales tax for qualifying tourism projects.