On February 24, 2017, the Venezuelan Tax Administration
published Ruling N° SNAT/2017/0003 in the Official Gazette
(hereinafter "the Ruling"), increasing the value of the
Tax Unit (hereinafter "UT") from 177.00 Venezuelan
bolivars (VEF 177.00) to VEF 300.00. A "tax unit" is an
amount that links benefit increases and fines to tax rates, instead
of fixing them in local currencies and subjecting them to inflation
indexes. The increase became effective on February 24, 2017. The
following describes some of the consequences of this increase for
the labor market.
Increase of the "Meal Benefit"
In accordance with the Meal Benefit for Workers Law, employers
must grant employees a payment for the "meal benefit,"
which is equivalent to 12 UT per day times 30 days per month, or
360 UT per month. The Ruling increases the amount of the meal
benefit to a daily amount of VEF 3,600.00, or a monthly total of
Changes to Taxable Events
In accordance with the Organic Law of Science, Technology and
Innovation, companies that have gross earnings higher than
100,000.00 UT are obliged to finance the science, technology, and
innovation fund through the payment of a tax contribution. The
Ruling amends this requirement so that companies should contribute
to the fund at the end of the year only if their earnings are
higher than VEF 30,000,000.00 for 2017. The amount of the tax
contribution depends on the type of economic activity the company
2% of the gross earnings for casinos
and companies related to alcohol and tobacco;
1% of the gross earnings for private
companies and 0.5% for public companies related to oil and gas and
0.5% of the gross earnings for
companies related to any other economic activity.
In the same way, the Organic Law of Sports, Physical Activity,
and Physical Education establishes that companies that have gross
earnings exceeding 20,000.00 UT are obliged to pay 1% of its gross
earnings for financing the sports, physical activity and physical
education fund. The Ruling amends this obligation as well:
companies should only contribute to the fund at the end of the year
if their gross earnings exceeded VEF 6,000,000.00 during 2017.
Increase in Fines
As a result of the increase in UT, all penalties have increased
as well. This is because Venezuelan labor laws have established the
value of fines in UT. For example, the Meal Benefit for Workers Law
provides that the employer's failure to grant this benefit will
result in a fine between 10 tax units (VEF. 3,000.00) and 50 tax
units (VEF 15,000.00), for each worker affected. Similarly, payment
of a salary lower than the mandatory minimum wage is punishable by
a fine between 120 tax units (VEF 36,000.00) and 360 tax units (VEF
108,000.00). Therefore, the increase in the amount of the tax units
also increases the amount for any sanctions due to violations under
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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On February 24th, 2017, the decree by which several sections of articles 107 and 123 of the Mexican Constitution are amended in connection to the labor justice system, was published in the Official Federal Gazette.
Labour relationships in Argentina are governed by the Argentine Constitution, international treaties and conventions and, in most cases, by the Labour Contract Law.
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