SOL-520-11-000011 - Amendment No. 1 - Attachment 4.doc

USAID/GUATEMALA Central American PROGRAMS

ORDER No.: 6.19

SUBJECT: Value Added Tax (VAT) Exemption Procedures

REFERENCE: GOG Decree #78 of 9/1/1954, Valued Added Tax

(Impuesto al Valor Agregado IVA) Law #27/92 and its Amendments

EFFECTIVE DATE: January 1, 2000

SUPERSEDES: M.O. 6.19 dated September 19, 1997

PAGE: 1 of 4

I. PURPOSE

The purpose of this USAID Mission Order is to amend established procedures to be followed in the management of the IVA Exemption forms, both for official procurement and personal purchases made by U.S. Government Employees (USDHs, USPSCs, TCNs), Institutional Contractors and Grantees.

II. POLICY

Under the Vienna Convention on Foreign Relations all diplomatic missions and consulates at post are tax exempted. Also, under the Agreement between the Government of Guatemala and the Government of the United States of America of September 1, 1954 all supplies, materials, equipment or funds entered into the Country by the United States Government for the purpose of accomplishing the USAID’s program objectives are tax exempted.

III. LIMITATIONS

A. The limit set up to issue IVA Exemption forms is Q800.00. An IVA Exemption form must be issued for all official purchases when the NET amount of the goods or services exceeds Q800.00. The limit applies to the amount of the goods or services, not to the amount of IVA. However, IVA Exemption forms may be used to cover hotel rates even if the daily rate is lower than Q800.00, at the option of the entity receiving the services.

B. IVA forms can only be used for procurement by USAID funded activities, or for personal purchases for the following categories of employees: USDHs and their family members, US-hired contractors (i.e. USPSCs, TCNs), Institutional contractors and Grantees.

IV. DEFINITION OF TERMS

VAT: Value Added Tax or IVA (Impuesto al Valor

Agregado)

IVA Exemption Form: Accounting document through which

Diplomatic missions get Value Added Tax

Exemption

NIT: Tax Identification Number (Número de

Identificación Tributaria)

AID’s NIT: 347442-9

Personal Purchase: This category of purchases includes any purchases for personal use of eligible employees per Section III.B.

V. AUTHORIZING OFFICERS AND RESPONSIBILITIES

The persons listed below are accountable for the forms, and are also designated to sign them for OE or project procurement, depending on their area of responsibility, and for personal use by eligible employees as listed in Section III.B. BLANK FORMS SHOULD NOT BE SIGNED.

George Carner, Director

Deborah Kennedy-Iraheta, Deputy Director

Erhardt Rupprecht, Deputy Regional Director

Robert Kahn, Chief, Project Development and Management Office

David Barth, Regional Legal Advisor

John McCarthy, Peace Project

Braden Enroth, Regional Contracting Officer

Alan Reed, Executive Officer

Thomas Walsh, Controller

Randall Peterson, Chief, Trade and Economic Analysis Office

Bernai Velarde, Trade and Economic Analysis Office

Brian Rudert, Chief, Income and Natural Resources Office

Ronald Ruybal, Income and Natural Resources Office

Keith Kline, Income and Natural Resources Office

Jeffrey Borns, Chief, Office of Democratic Initiatives

Steven Hendrix, Office of Democratic Initiatives

Mary Ann Anderson, Office of Health and Education

Julia Richards, Office of Health and Education

Stanley Terrell, Office of Health and Education

Edward Scholl, Office of Health and Education

Philip Jones, PROARCA

Anne Dix, PROARCA

Sarah Wines, Director Regional Urban Development Office

Sonny Low, Regional Urban Development Office

Elizabeth Bauch, Regional Urban Development Office

VI.

CONTROL OF FORMS:

IVA Exemption forms will be provided to senior secretaries by the Travel Assistant. It is the senior secretaries responsibility to maintain adequate distribution and control of the IVA forms assigned to each Division. It is the Travel Assistant’s responsibility to maintain an adequate stock of IVA exemption forms.

VII. PROCEDURES

Following are the guidelines to obtain, issue, and report the I.V.A. exemption forms:

A. IVA forms will be provided to all senior secretaries or their designees, in accordance with each Division’s requirements, for signature by the persons designated in Section V above. All senior secretaries or their designees are responsible for the preparation of I.V.A. forms in the following cases:

1. Official use (i.e. Hotels)

2. Personal purchases

a. Made by eligible employees as stated in

Section III.B.

b. Return third copy of IVA form as soon as possible NO NEW IVA FORMS WILL BE PROVIDED

UNTIL USED FORMS ARE RETURNED TO SENIOR

SECRETARIES

B. Receipts/bills/customs forms should be issued as follows:

- Name of Employee or Project/USAID

- USAID Mission’s NIT

C. For USAID funded procurement by contractors/grantees located outside the USAID facilities, senior secretaries or their designees will provide the project manager a number of IVA forms needed in accordance with their requirements. Upon presentation of the used IVA forms the senior secretary will replenish the contractor/grantees stock.

D. All senior secretaries must log in all the IVA forms in the DTS (Document Tracking System) on a daily basis and should return the copies to the Travel Office every two weeks, in order to obtain a new stock of forms. (For more instructions on the reporting requirements, refer to Section VIII of this Mission Order.)

E. Instructions to fill out the forms: (See Exhibit 1)

1. The I.V.A. exemption forms should contain the following information:

- Date of form

- IVA Amount in local currency

- Supplier/Vendor's name

- Supplier/Vendor's NIT number

- IVA amount spelled out

- USAID NIT Number

- Signature of authorized official (SEE V.

ABOVE)

In the bottom part of the form, the following information must be included:

- Invoice #

- Date of Invoice

- Amount without IVA

- IVA Amount

- Total Amount

REF: Office Initials

2. Forms should be filled out completely

3. Distribution of IVA form:

- Original and 1 copy: Supplier/Vendor/Customs

- Second Copy: USAID Files. The third copy (Mission copy) should be completely legible. If it is not legible a copy of the bill or receipt should be attached.

VIII. REPORTING REQUIREMENTS

The Ministry of Finance requires all diplomatic missions in Guatemala to prepare a quarterly report, which shows the usage of all IVA Exemption Forms per month. It is the responsibility of the officers designated in Section V above to ensure that IVA exemption forms are logged in on a daily basis, and reported to EXO biweekly.

These reports will then be consolidated by the Travel Office and sent to the Ministry of Finance quarterly within the first ten working days of the respective month.

Senior secretaries or their designees will have access to the IVA program on a permanent basis, which will be available in the Local Applications Option under the "DTS" icon.

IX. OTHER CONSIDERATIONS

According to an amendment to the IVA law published on December 23, 1994, vendors must include the total amount, IVA included, on their invoices. Employees involved in the processing of vouchers shall check that all invoices meet this requirement.

Alan Reed

Executive Officer

NOTE: ATTACHMENT NOT AVAILABLE ELECTRONICALLY, PLEASE REQUEST A COPY TO YOUR OFFICE SENIOR SECRETARY.

RFP No. SOL-520-11-000011 - SJSRP

Amendment 1

Attachment 4