Chile has a VAT (value added tax) – known as IVA – that added to the price of everything you buy. This is also known as Goods and Services Tax (GST) in some countries.
How much is IVA Tax
IVA tax in chile is currently at 19% in 2015 but will be going up every year for a few years. You don’t see the IVA on your receipts as it’s already included into the price of goods and services.
Do foreigners and tourists have to pay IVA Tax?
You can avoid paying the IVA tax if you are staying in a hotel or aparthotel (long term, unfurnished apartments are also exempt from IVA for everyone).
If you pay for your hotel with foreign money (like dollars of euros) or with a foreign credit card (may not work in all cases), you don’t have to pay IVA!
There are some exceptions. Your hotel has to be registered with the tax office of Chile (SII) and needs to take a copy of your passport with the white immigration card received when you entered the country. Some small lodgings and aparthotels may not be registered with the Chile tax office so you wouldn’t receive an exception of the IVA tax. You also have to be staying in Chile for less than 60 days.
Even though you’re a foreigner or tourist, you’ll pay tax on all other purchases (you probably won’t notice because it’s included in all the prices).
How can I get an exception from paying IVA tax when I’m staying at a hotel?
When you pay for your lodging , be sure to ask if IVA tax is included in the price. Ask for the discount if you are going to pay with foreign currency or credit card . You only need to present your passport and immigration card that you receive at the airport to get to Chile to prove you are a foreigner. What out for hotels that as your for your passport to get exempt from IVA but then still charge your the IVA!