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New Uruguayan Customs Rules for US Online Purchases Called a 'Hurdle' by Couriers
🇺🇾 Uruguay /Economy & Trade

New Uruguayan Customs Rules for US Online Purchases Called a 'Hurdle' by Couriers

From El País · (3d ago) Spanish Critical tone

Translated from Spanish, summarized and contextualized by DistantNews.

TLDR

  • Uruguay's National Customs Directorate (DNA) has issued a new resolution altering the tax regime for international online purchases, effective May 1.
  • Purchases from the US will be exempt from the 22% VAT, but new administrative procedures are required, which couriers deem a "hurdle."
  • The resolution aims to streamline e-commerce regulations but may inadvertently increase costs for consumers buying from US-based sellers.

Uruguay's Directorate of National Customs (DNA) has introduced a new resolution concerning international online purchases, set to take effect on May 1st. This update modifies the existing franchise system, notably imposing a 22% Value Added Tax (VAT)—dubbed the "Temu tax"—on most international e-commerce transactions. However, a key exception is made for purchases originating from the United States, which are intended to remain VAT-exempt under the Uruguay-US Trade and Investment Framework Agreement (TIFA).

The resolution that refers to how purchases from the US will be exempted from VAT is actually a 'hurdle' to that exemption, according to couriers consulted by El País.

— El PaísReporting on the new customs resolution and its impact on US-based purchases.

Despite the intention to maintain the VAT exemption for US-based purchases, several courier services operating in Uruguay view the new administrative requirements as a significant "hurdle." The DNA resolution mandates that companies shipping from the US must undergo a registration process, including certifications, with the customs authority. This requirement extends to individual sellers, meaning that even major US retailers like Adidas or Nike would need to register for Uruguayan consumers to benefit from the VAT exemption.

In practice, it will end up making these purchases subject to VAT, they maintain.

— El PaísCouriers' assessment of the new VAT regulations for US imports.

Couriers, speaking anonymously to El País, expressed concern that these complex procedures might effectively negate the intended exemption, potentially leading to higher costs for consumers. They argue that the new rules contradict the spirit of the TIFA agreement and represent an outdated approach to e-commerce regulation. The concern is that many US-based sellers, especially smaller ones, will not register, causing their products to be subject to the 22% VAT, thereby increasing the final price for Uruguayan buyers and potentially stifling cross-border e-commerce.

This is seen by couriers consulted by El País as a 'hurdle to the exemption' of VAT on packages from the US and that with this they want to 'collect more'.

— El PaísInterpreting the customs resolution as a revenue-generating measure.
DistantNews Editorial

Originally published by El País in Spanish. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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