The following instruments were published in Official Gazette Special Issue No. 6,507 dated January 29, 2020:

1. Constituent Decree enacting the Tax Code.
2. Constituent Decree Amending the Executive Decree Enacting the Customs Act.
3. Constituent Decree Partially Amending the Executive Decree Enacting the Value Added Tax Act.

Below please find a brief summary of the most noteworthy changes provided for in each:

1. Constituent Decree Enacting the Tax Code:
   1. The new Code continues to provide for the Tax Unit, although with some changes, the most noteworthy of these being the fact that they are to be used only for the purpose of determining national taxes subject to the oversight of the National Taxation Authority. It also provides that any adjustment there to shall require the authorization of the President of the Republic, although no specific term is given for this purpose.
   1. In the case of exemptions: The new code reduces the maximum period to one year, with some exceptions in the case of non-profit institutions engaging exclusively in religion-related activities. It also provides that all exemptions are to be included in a single administrative action, to be called the General Decree on National-Tax Exemptions, that is to be published for each “economic financial year.” The changes made by this Decree are to be submitted by the ministry in charge of financial affairs for consideration by the President of the Republic. According to the transitional provision included in Article 347, this Decree is to be issued within a term of 60 days.
   1. Penalties formerly set in Tax Units will now be stated in terms of the official exchange rate for the highest-rated currency published by the Central Bank of Venezuela on the date on which paid.
   1. Nevertheless, the figures for the tax base as well as tax credits or debits reported by taxpayers in tax returns or tax-payment vouchers, as well as the taxes payable, accessory payments or penalties determined in administrative or judicial documents, are to be stated in bolivars, except in the case of any exceptions established by the Central Bank of Venezuela.
   1. The decree changes the term allowed for delivery of the defense arguments and the decision in an administrative case when the original Objection mentions possible tax fraud by the taxpayer.
   1. The precautionary measures allowed now include a general freeze on any bank account activity.
   1. Inter alia, the transitional provisions allow a term of one year following publication of the Decree in the Official Gazette for other government bodies and agencies to replace the unit used to determine labor benefits, rates and fees for the services they provide in those cases in which they are now set in Tax Units.
   1. The effective date of this Decree is 30 calendar days after publication in the official Gazette.
2. Constituent Decree Amending the Executive Decree Enacting the Customs Act:
   1. The document states that commercial policy shall be governed by the provisions of this Decree.
   1. The President of the Republic has been granted additional powers to those originally stipulated in Article 3.
   1. The term for a rule to become effective, in the case of changes to a tax, a tax rate, a surcharge or other sum, has been reduced from 60 days to 15 days following publication in the Official Gazette.
   1. As in the case of the Tax Code, penalties set in Tax Units will now be stated at the official exchange rate for the highest-rated currency published by the Central Bank of Venezuela on the date on which paid.
   1. The Decree states that the rules and regulations applicable to bonded warehouses will continue to apply until the National Executive issues the new rules and regulations, which it must do within a term of 180 days.
   1. These amendments shall become effective within 20 calendar days following publication in the Official Gazette.
3. Constituent Decree Partially Amending the Executive Decree Enacting the Value Added Tax Act:
   1. The Decree sets an additional rate, ranging between 5% and 25%, for goods and services paid for in foreign currency, cryptoassets, or cryptocurrencies other than those issued and backed by the Bolivarian Republic of Venezuela.
   1. The percentage of this additional rate is to be determined by the National Executive and will be applicable:
      1. When the sale of personal property or the rendering of services is paid for using any of the above.
      1. If a notary public must validate the registration by the parties of a sale of personal property for it to be considered valid, the notary must ask to see the documents proving payment of the price.
      1. In the case of the sale of real property agreed to and paid in any of the currencies listed above, only the additional VAT rate will be payable. Registrars must ask to see the document proving payment.
      1. In the case of payments for personal property or services that are not subject to VAT, only this additional rate will be payable.
      1. Invoices issued for transactions covered in Article 62 must state the currency, cryptocurrency or cryptoasset used to pay for the transaction as well as the equivalent in bolivars.
      1. This additional VAT rate will become effective 30 calendar days after the Decreeissued by the National Executive stating the percentage applicable has been published in the Official Gazette.
   1. This Decree shall become effective 60 days after publication in the Official Gazette.

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Yours truly,

Benson, Pérez Matos, Antakly & Watts

Ysabel Figueira