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January 3, 2023

Uruguay introduces zero VAT rate on hotel-related services to resident tourists for the summer season

  • The new zero Value Added Tax (VAT) rate will apply for hotel-related services provided to resident tourists throughout the summer season.

Uruguay’s Law N°20,098, enacted on 12 December 2022, establishes that lodging-related services rendered to resident tourists will be subject to a 0% VAT rate (treatment that already applies for nonresidents) until 28 February 2023, provided that the followings conditions are met:

  • The taxpayer must be registered on the Ministry of Tourism as a hotel, apart hotel, motel, hostel, rural establishment, or similar establishment.

  • The taxpayer’s annual income, in the last fiscal year closed prior to the entry into force of this bill, does not exceed 10,000,000 indexed units (US$1,430,000 approx.). Decree N°410/022 issued by the Executive Power on 23 December 2022, clarifies the type of income that should be taken into account, confirming that income from hotel services and all of those services charged to the guest, except from restaurant services, should be considered.

Law N°20,098, published on 14 December 2022, in the Official Gazette, can be accessed here, and is effective since its date of enactment. Decree N°410/022, which has not been published yet, can be access here.


For additional information with respect to this Alert, please contact the following:

EY Uruguay, Montevideo

Ernst & Young LLP (United States), Latin American Business Center, New York

Ernst & Young LLP (United Kingdom), Latin American Business Center, London

Ernst & Young Tax Co., Latin American Business Center, Japan & Asia Pacific


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