Peru Proposes Temporary VAT Reduction to Boost Investment and Economic Competitiveness

• Peruvian Congress is considering a bill for temporary VAT rate reduction.
• Bill No. 11228/2024-CR was submitted on 19 May 2025.
• The bill aims to reduce the VAT rate to promote investment and competitiveness.
• The proposed VAT rate is 15 percent for 2026, 16 percent for 2027, and 17 percent for 2028.
• The reduction applies to individuals and companies in all productive sectors.
• Companies must adjust their income tax rate by 1 percent to compensate for the VAT reduction.
• The temporary VAT rate is effective from 1 January 2026 to 31 December 2030.
• The Executive Branch has 60 days to regulate the law through the Ministry of Economy and Finance.

Source: wb2server.congreso.gob.pe

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.