Reimbursement of Value-Added Tax (VAT) for destruction of Fixed Assets in the development of operations

Abstract

The VAT is a tax whose tax capacity aims to affect the final consumers of goods and services; however, there are substantial and formal requirements whose breaches cause the company to be unable to exercise the right to the tax credit or to have it reinstated. Thus, they are forced to destroy their buildings (fixed assets) as part of an improvement plan, as well as to consider the construction of new buildings, the relocation of facilities due to the needs of the operation, among others. Considering this context, the objective of this work is to determine what tax contingencies with respect to the VAT these operations produce. For this, a descriptive and analytical investigation was carried out, based on the analysis of article 22 of the General Sales Tax Law (VAT). From this, it was found that the rule expressly excludes the obligation to reimburse four cases, among which there is no need to specify the case that was previously raised. Thus, it is concluded that a pronouncement by the Tax Administration regarding these operations is necessary, since, although they are not in one of the exclusions, they are justified in reasons directly linked to other operations, and, in many cases, since they are assets that are fully depreciated, they should not generate the loss and refund of the tax credit.