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Honduras raises 2014 Sales Tax to 15%

  • VAT
  • 14 January 2014 | Richard Asquith

Honduras raises 2014 Sales Tax to 15%

Honduras has increased its Sales Tax rate from 12% to 15% from 1 January 2014.

Note, whilst known as Sales Tax, the Honduran system allows for the recoverability of input Sales Tax by businesses, and so it effectively operates like an OECD VAT regime.

As part of the tax rise package, a number of basic foodstuffs were removed from the Sales Tax net.  Otherwise, most goods and services are subject to the tax, including importations.  Businesses or taxable persons must automatically register for Honduran Sales Tax, although there is no requirement to complete monthly returns if annual turnover is below L180,000.  There is a requirement for certain providers to the final consumer to withhold VAT, e.g. credit card companies.

There is a higher rate Sales Tax, which has also risen from 15% to 18%, for:

  • alcohol
  • soft sugary drinks
  • cigarettes; and
  • first class air travel

VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.