VAT Rates in Mongolia

Quick overview

Standard Rate	Reduced Rate	Other Rates
10%	N/A	0%, Exempt

The local name for VAT in Mongolia is Value Added Tax (VAT)

There are basically 1 VAT rates in Mongolia, a Standard VAT rate of 10%. Notably, there is a also a Special Tax rate of 0-10%.

Recent developments

For more information about (recent) rate change developments in Mongolia, please click HERE.

Standard rate: 10%

This rate applies for all transactions that take place in Mongolia, unless an exception applies (such as a reduced rate, the zero rate or an exemption, or a reason to treat the transaction as outside scope of VAT).

Special rate (0%-10%)

Examples of goods and services taxable at special rates 0%-10%

• Imported and manufactured gasoline and diesel fuel only. The Government shall set the exact rate considering the specifics of the sector.

Zero rate (0%)

Examples of goods and services taxable at 0%

• Goods exported from the territory of Mongolia and declared with the customs organization
• Passenger and cargo transportation services rendered from the territory of Mongolia to foreign countries, from foreign countries to the territory of Mongolia, as well as from foreign countries to third countries transiting through the territory of Mongolia, pursuant to the international treaties to which Mongolia is a signatory
• Services provided in a foreign country (including tax-exempt services)
• Any rendering of services (including “nontaxable services”) to a nonresident person
• Any services of air navigation management, technical and fuel services, and cleaning that shall be provided for both foreign and domestic airplanes conducting international flight and sale, food and drink services provided for air crew members or passengers during flight
• State medals and coins manufactured domestically on the order of the Government or the Bank of Mongolia
• Mining finished products that are exported (Government approves list of final mining products)

Examples of exempt supplies of goods and services

The term “exempt” refers to supplies of goods and services that are not liable to VAT and that do not qualify for input tax deduction.

• Passengers’ personal-use goods (subject to permitted amounts and approval by customs authority)
• Goods received through humanitarian and grant aid from foreign governments, NGOs and international or humanitarian organizations
• Special purpose appliances, equipment and machinery designed for physically challenged persons
• Civil passenger airplanes and spare parts thereof
• Revenues from the sale of establishments used for housing or portions thereof
• Blood, blood products and organs to be used for purposes of specified treatment
• Gas fuel, gas fuel containers, equipment, special purpose machineries, mechanisms and related mechanics
• Sale of gold
• Experimental products related to research and scientific work
• Mining products other than mining finished product that was exported
• Cereal, potatoes, seeds, vegetables and fruits domestically grown and sold by farmers and domestically produced flour
• Asset-backed loan portfolio or claiming rights derived from financial leasing arrangements transferred by banks, nonbanking financial institutions (NBFI) or other legal entities to other banks, special purpose companies or mortgage corporations
• Imported woods, timbers, cut materials, planks, wooden pieces and semi-processed wooden materials
• Exported cashmere and leather that has been raw processed (cleaned and brushed)
• Import of special purpose machinery, equipment, parts, raw materials, and chemical or explosive substances imported by contractors and subcontractors to be used for crude oil and nontraditional crude oil industry for the first five years of an exploration period or for exploration periods of less than five years
• Import of equipment, tools and accessories for renewable energy production and research
• Currency exchange
• Banking services, such as the receipt or transfer of money, or any dealing with money, any security for money or any note or order for the payment of money and the operation of any savings account
• Services of insurance, reinsurance and registration of property
• The issuance, transfer or receipt of any securities and shares, and underwriting of such securities
• The issuance of loans
• The provision or transfer of an interest related to a social and health insurance fund
• Loan interest, financial lease interest, dividends, loan guarantee fees or insurance premiums by banks, NBFIs, or saving and loan cooperatives
• Rental of residential houses and apartments
• Medical services
• Services of religious organizations
• Services provided by a government organization; this shall include public services provided by the government, its agencies and budgetary organizations
• Public transportation services
• Tour operating services
• Weapons and special equipment imported for the needs of the armed forces, police, state security, enforcement of court decisions, state special protection organizations and the anti-corruption agency

 

Source EY

A global VAT/GST rate overview can be found here (note this is a work in progress).

This post was last updated on August 26, 2021.