THE NATIONAL ASSEMBLY OF THE BOLIVARIAN REPUBLIC OF VENEZUELA

DECREES

the following,

ALCOHOL AND ALCOHOLIC PRODUCTS TAX LAW

TITLE I GENERAL
PROVISIONS

Article 1. Ethyl alcohol and alcoholic species of national or imported production,

intended for consumption in the country, are subject to the tax established by this
Law.
The Annual Budget Law may increase or decrease by up to fifty percent (50%) the
taxes established in articles 11, 12, 13, 14 and 18 of this Law.

Article 2. The exercise of the industry and trade of ethyl alcohol and alcoholic
species are taxed by the taxes established by this Law.

Article 3. The typical crafts and popular industries, of all indigenous alcoholic
beverages, derived from plant material, will enjoy a special regime from the State,
in order to preserve their authenticity and guarantee the repopulation of the
species.
For the purposes of this Law, artisanal production shall be understood as those
carried out by natural persons, cooperatives and other associative forms of social
organization and economy through the use of traditional arts or techniques, in
which manual labor predominates, to transform raw materials of plant origin
cultivated in the Bolivarian Republic of Venezuela with the aim of obtaining
alcoholic beverages suitable for human consumption. The artisanal production
obtained must not exceed twenty thousand liters (20,000 liters) in a calendar year,
in accordance with the Regulations of this Law.

Article 4. The creation, organization, collection and control of taxes on alcohol and
alcoholic species are entirely reserved to the National Power.

Article 5. The National Executive shall issue general regulations to restrict or

prohibit the establishment or operation of the industries and stores referred to in
this Law and establish security measures and control systems for the same, taking
into account the nature and location of these establishments, the density and
characteristics of the population where they are established, the fiscal interest,
public order and good customs.
In order to limit the advertising of alcoholic beverages, the National Executive will
issue, by means of a regulatory decree, the control and surveillance rules it deems
appropriate.

Article 6. The introduction into the territory of the Republic of ethyl alcohol and
alcoholic species whose use and consumption is not permitted in the country of
origin is prohibited.

Article 7. Ethyl alcohol and alcoholic species imported must be accompanied by a

certificate of origin, as determined in the Regulations of this Law.

Article 8. The Ministry of Finance shall determine the form, conditions and
procedures to be followed for the importation of alcoholic beverages.
Article 9. The Ministry of Finance shall establish the requirements that must be
met for the exercise of the industry and trade of ethyl alcohol and alcoholic species.

Article 10. For the purposes of this Law, the alcohol concentration will be
measured in percentage points or Gay-Lussac, which will be expressed with the
symbol G. L., and the concentration of the musts in Brix degrees. The reference
temperature for measuring volumes of alcohol and alcoholic species will be fifteen
degrees Celsius (15º C) and for musts it will be twenty degrees Celsius (20º C). The
Ministry of Finance, by regulation, may modify the reference temperatures when
international standards or national interest so justify; it will also, by resolution,
dictate the rules that must govern the alcoholimetric calculations derived from the
application of this Law.

TITLE
II OF THE TAX ON ALCOHOL AND ALCOHOLIC TYPES

Chapter
I Of the Tariffs

Article 11.

The tax on nationally produced ethyl alcohol will be 0.009 tax units for each litre of
alcohol containing references to one hundred Gay-Lussac degrees (100° GL). The
tax on alcoholic species of national production, obtained by distillation or by the
preparation of distilled products, will be 0.0135 tax units for each litre of alcohol it
contains, referring to one hundred Gay-Lussac degrees (100° GL).
The tax on alcoholic species of national production, obtained in an artisanal manner,
will be 0.0054 tax units per litre.

Article 12. The tax on national beer will be 0.0006 tax units per litre. Prepared
beverages based on beer are subject to the tax established in Article 11 of this Law.
Malt products and similar products with an alcohol content of up to one degree of
Gay-Lussac (1st GL) will not be taxed under this Law.

Article 13. Nationally produced wine obtained by the total or partial alcoholic
fermentation of grape juice or other fruit must will pay a tax of 0.00015 tax units
per litre when its alcohol content does not exceed fourteen degrees Gay-Lussac
(14° GL). Likewise, mistelas made by fermentation and sangrias without added
alcohol will pay a tax of 0.00015 tax units per litre.
Fortified or compound wines and sangrias with added alcohol, of national
production, will pay a tax of 0.009 tax units for each liter of alcohol they contain,
referred to one hundred degrees of Gay-Lussac (100° GL). For fortified or compound
wines and sangrias with added alcohol, of national production, obtained in an
artisanal manner, the tax will be 0.0018 of a tax unit.

Article 14. Ethyl alcohol and alcoholic species that are imported will pay the
following tax:
1. Rum and spirits made from sugar cane, 0.012 tax units per litre.
2. Bitter, dry and sweet liqueurs, and other unspecified beverages based on
preparations of fermentation products, 0.0153 tax units per liter.
3. Brandy, cognac, whiskey, gin and other alcoholic beverages not made from
sugarcane, not specified, 0.102 tax units per liter.
4. Ethyl alcohol, 0.018 of a taxable unit per litre, referred to one hundred degrees of
Gay-Lussac (100° GL).
5. Beer, 0.0025 of a tax unit per litre.
6. Wine obtained by the alcoholic fermentation of grape juice or must, whose
alcohol content does not exceed fourteen degrees of Gay-Lussac (14° GL), 0.00045
of a tax unit per litre.
7. Wines with an alcohol content exceeding fourteen degrees of Gay-Lussac (14°
GL), 0.0025 of a tax unit per litre.
8. Wines obtained by the fermentation of pears or apples, called cider, with an
alcohol content of less than seven degrees of Gay-Lussac (7° GL), 0.00045 of a tax
unit per litre.
9. Alcoholic raw materials intended for the production of alcoholic beverages, 0.003
of a tax unit for each litre of alcohol it contains, referred to one hundred degrees of
Gay-Lussac (100° GL).

Article 15. The taxes established in Articles 11, 12 and 13 are incurred at the time
of production of ethyl alcohol, beer and natural wines, as the case may be, but are
only payable when they are removed from the producing establishments, except as
provided in Article 16.
Ethyl alcohol and alcoholic species lost through evaporation, spillage or other
natural or accidental causes occurring in industries producing alcohol and alcoholic
species that operate under closed production systems or Fiscal Warehouses are
exempt from paying the tax.
In the process or processes in which the industries producing ethyl alcohol or
alcoholic species do not operate under closed production systems or Fiscal
Warehouses, the Ministry of Finance will set the maximum limits of losses of ethyl
alcohol and alcoholic species exempt from taxes, for the reasons established by the
regulations of this Law.

Article 16. When ethyl alcohol or alcoholic species are intended to serve as raw
material in the production of other species, the tax to be paid will be that
corresponding to the new species produced and will become payable at the time it
is issued. In this case, the responsibility of the producer of the raw material for the
tax payable will cease from the moment in which the competent tax official verifies
its entry into the recipient establishment, with the National Treasury being
guaranteed by the guarantees determined by the regulations of this Law. In the
case of imported alcoholic raw materials, they must pay, in addition to the tax
provided for in section 9 of article 14, the tax applicable to the newly produced
species.

Article 17. The internal tax referred to in article 14 shall be payable at the same
time as the import tax is collected, and the goods may not be withdrawn from the
respective Customs Office without payment having been made, without prejudice to
what is established in the regulations.

Article 18. A tax is established on the issue to the public of national or imported
alcoholic species at 0.00005 of a tax unit for beer and at 0.0001 of a tax unit for
other alcoholic species per litre, except as provided for in article 15 of this Law.
Natural wines and mistelas of national production are exempt from this tax. This tax
will be paid by producers or importers at the time of dispatch of the alcoholic
product from the producing establishments or its withdrawal from Customs.

Article 19. The taxable base of the tax established in the previous article will be
the sale price to the public, provided that it is not lower than the current market
price, in which case the taxable base will be the latter price.
For the purposes of this Law, the current market price shall be the price normally
paid for similar alcoholic beverages on the day and place where the taxable event
occurs as a result of a sale made under conditions of free competition between a
buyer and a seller who are not related to each other. The Tax Authority may
determine the current market price based on a sample taken from companies
marketing alcoholic beverages.

Article 20. The Tax Authority may proceed to determine ex officio the tax
established in this Law, in any of the cases provided for in the Organic Tax Code, in
addition, in all cases in which for any reason the amount of the taxable base
declared by the taxpayer is not reliable or is significantly lower than that which
would result from applying the current prices in the market whose sale or delivery
generates the tax.

Article 21. In addition to the taxes established in articles 11, 12, 13, 14 and 18 of
this Law, alcoholic beverages of national or imported origin are subject to the
payment of a tax equivalent to the amount resulting from applying the following
percentages on their sale price to the public:
Eight point fifty percent (8.50%), beer and natural wines.
Ten percent (10.00%), other beverages up to fifty degrees Gay-Lussac (50.0º GL).
This tax will be paid by producers or importers within ninety (90) continuous days
following the dispatch of alcoholic beverages from production establishments or
their withdrawal from Customs, as the case may be; except for the tax
corresponding to the last quarter of the year, which will be paid no later than the
last business day of each year.
For the purposes of applying the tax, interested parties shall inform the Tax
Administration of their jurisdiction, at least fifteen (15) business days in advance, of
any variation in the prices of alcoholic beverages.

Article 22. Ethyl alcohol and alcoholic species of national production intended for
consumption outside the country, or to stores located in territories under the Free
Trade Zone or Free Port regime, or when sold to ships and aircraft that touch at
Venezuelan ports and airports bound for abroad, are not taxed by the tax
established in this Law.
The Regulation shall determine the control measures necessary to prevent the
circulation in the country of the species specified herein.

Chapter
IIOn Tax Exemptions, Exonerations and Refunds

Article 23. The National Executive is empowered to exempt from taxes alcoholic
beverages of national production or imported for the personal use and consumption
of diplomatic officials or missions of the same nature accredited to the National
Government, under conditions of reciprocity.

Article 24. Re-exported alcoholic species may be exempt from tax as determined
in the Regulations of this Law.

Article 25. The National Executive is empowered to agree to the total or partial
exemption of taxes levied on foreign alcoholic beverages, when they are destined
for stores located in territories under the Free Trade Zone or Free Port regime, or
when they are sold to ships or aircraft that touch Venezuelan ports bound for
abroad.

Article 26. The artisanal producers of national alcoholic beverages and those who
sell, exclusively, alcoholic beverages obtained by artisanal means will be exempt
from paying the fees provided for in sections 1 and 2 of article 10 of the Fiscal
Stamp Law.

Article 27. The National Executive may fully or partially exempt the tax levied on
ethyl alcohol produced in the country when it is to be denatured in order to make it
importable or unusable in the production of beverages or food, when it is intended
for Official Institutes of the National Government, States or Municipalities, for use by
welfare, charitable or research institutes, or when it is used for industrial purposes
that by their nature or condition require this benefit, in accordance with the
requirements established by the Regulations of this Law.
Article 28. The Ministry of Finance will exempt taxes on ethyl alcohol and domestic
or imported alcoholic species that have disappeared due to sufficiently proven
accidents or that require reprocessing or destruction due to failure to meet the
quality requirements demanded by the respective industries.

Article 29. When a taxpayer or the purchaser of a species is in a position to invoke

the benefits of exemption, exoneration or reduction referred to in the previous
articles and the corresponding taxes have already been paid, he may request a
refund, in accordance with the legal and regulatory rules applicable to the particular
case.

Article 30. Exemptions may be revoked by the National Executive when the
beneficiaries thereof do not meet the requirements established in this Law, its
Regulations and in the Resolution that agrees to them.

Chapter IIIOn
the Liquidation and Collection of Taxes

Article 31. The liquidation of the taxes established by this Law will be carried out
by the competent officials.
The National Executive, through the Ministry of Finance, may order that the
liquidation be carried out by the taxpayers themselves, as established in the
Regulations of this Law.

Article 32. The tax referred to in Article 14 of this Law shall be settled by the
Customs Office at the same time as the applicable import taxes are settled.

Article 33. The taxes established in articles 18 and 21 shall be settled at the same
time as the taxes provided for in articles 11, 12, 13 and 14 and in the manner and
conditions established by the Regulations of the Law.

Article 34. The Ministry of Finance may establish the use of bands, capsules, seals
or any other security attachments, which will be sold at cost to producers and
importers of taxed species in the amount required by them to cover the species and
their price must be included in the corresponding tax settlement forms. It will also
determine the way in which they should be used.

Article 35. The Regulations shall establish the procedure for the liquidation and
collection of taxes created by this Law, as well as the deadlines within which the
payrolls must be paid.

TITLE III
OF TAX ADMINISTRATION
AND FISCAL CONTROL

Chapter IGeneral
Provisions

Article 36. The Ministry of Finance shall establish the organization and operation of
the Offices in charge of the administration, liquidation and inspection of the taxes
established in this Law.

Article 37. The Offices and Safeguard Officers will be in charge of pursuing
smuggling, monitoring the circulation of alcohol and alcoholic species and
repressing clandestine production.
Article 38. The safeguard will be structured in the manner determined by the
Regulation, with the powers indicated by the Organic Law of the National Public
Treasury. When the National Executive deems it appropriate, the protection
functions may be performed, throughout the National Territory or in certain
districts, by the respective specialty of the Armed Forces of Cooperation.
The Ministries of Defense and Finance will issue joint resolutions on the provisions
necessary for the operation of the service.

Article 39. When due to lack of accounting or irregularities in the entries thereof,
loss or misplacement of books or receipts and in general, when for any reason it is
not possible to determine the legal bases to calculate the corresponding taxes that
must be paid by virtue of the provisions of this Law, tax officials may make an
estimate ex officio through presumptive assessments, derived from the data,
circumstances or facts that directly or indirectly allow establishing the assumptions
required to determine the contribution.

Article 40. The National Executive, through the Ministry of Finance, may order or
authorize the installation of special controls on the production of ethyl alcohol or
alcoholic species, such as closed production systems or Fiscal Warehouses, which
will have the characteristics established by the Regulations of this Law.

Article 41. The National Tax Administration may simplify or establish special
characteristics for the fulfillment of the duties established in this Law, by national
producers of alcoholic beverages obtained in an artisanal manner from vegetable
raw materials, or to those categories of taxpayers that it determines in the
regulatory instrument issued for such purposes.

Article 42. The industry and trade of ethyl alcohol and alcoholic species, as well as
the manufacture of devices suitable for distilling alcohol shall be permanently
subject to visits, interventions and presentation of all books and documents for the
purposes of verifications and other fiscal surveillance measures.

Article 43. The Tax Administration may deny the registration referred to in Article
45 of this Law, when the conditions established therein and in its Regulations for the
operation of industries and businesses related to alcohol and alcoholic species are
not met.
Likewise, the registrations and authorizations granted may be suspended or
revoked when the guarantees established in favor of the National Treasury do not
present the required security or are not easily enforceable, when adulterated
beverages are sold, when an attempt is made to engage in commercial and
mercantile activities contrary to the law, when any of the essential requirements
established in this Law and its Regulations for the exercise of industry and sale are
not met, and when the situation of the establishments and other circumstances
related to them are such that they facilitate fraud against the National Treasury.

Likewise, the registrations and authorizations granted may be suspended or

revoked when the owners, representatives, employees or other persons present at
the establishment prevent or hinder the inspection or verification work by the Tax
Administration, or when it is known that events contrary to public order and good
customs have occurred at the establishments selling alcoholic beverages.

Article 44. Purchasers and tenants of industries and stores selling alcohol or
alcoholic beverages shall be jointly and severally liable for the tax obligations of
their predecessors arising from this Law.

Article 45. The exercise of any industry or business included in this Law is
incompatible with the performance of fiscal or administrative positions related to
the branch and with the functions of civil, police or military authority, in their
respective jurisdictions.

Chapter
IIOn the Formalities for the Exercise of the Alcohol and Alcoholic Species
Sales Industry

Article 46. Industries related to alcohol and alcoholic species, manufacturing and
factories of distillation apparatus, may only operate through prior registration at the
National Tax Administration Office of their tax domicile.
The Regulations of this Law shall determine the data that must be contained in the
respective registration applications and the documents and verifications that must
accompany them.
The necessary authorizations for the sale of alcoholic beverages will be granted by
the mayors, in accordance with the regulations established by the respective
ordinances, without prejudice to the provisions of the laws governing municipal
matters. Until the competent municipal bodies issue the regulations regarding
authorizations for the sale of alcoholic beverages, the mayors will be responsible for
enforcing the provisions contained in this Law and its Regulations.

Article 47. In order to commence their activities, industrialists of taxable species

must provide security, as determined by the Regulations of this Law.

Article 48. Industrialists, merchants and carriers, as well as manufacturers and

holders of distillation apparatus are required to keep the books, records, relations
and forms established for each case by the Regulations of this Law or by the
Ministry of Finance by Resolution.

Article 49. The exercise of the alcohol and alcoholic species production industry is
presumed to have begun from the moment in which the industrialist receives the
corresponding authorization from the Revenue Office of the Jurisdiction.

Article 50. When, due to unforeseen circumstances or force majeure, the

production process of alcohol and alcoholic species must be interrupted,
manufacturers must notify the Revenue Office in writing as soon as possible, so that
it can seal the equipment or take any other measures that will prevent the
continuation of said process until the reason for the interruption ceases.

Article 51. Any person who has in his or her possession or acquires suitable
equipment for the distillation of alcohol and alcoholic species, even when
disassembled, is required to register it at the Revenue Office of the Jurisdiction.
The installation of such devices, their transfer or disposal must be previously
authorized by the Revenue Office of the jurisdiction.
The Revenue Offices will seal the devices that are not in operation and take any
other measures that prevent their operation.

Article 52. The use, circulation and sale of raw materials intended for the
distillation, preparation or production of alcohol and other alcoholic species and, in
general, everything related to said processes, is subject to the provisions
established by the Ministry of Finance.

Article 53. The distillation process of artisanally produced alcoholic beverages from
plant raw materials will be carried out in compliance with the regulations
established by the National Tax Administration.

Article 54. The National Executive, through the Minister of Finance, shall dictate
the regulations to which the process of distillation and denaturing of ethyl alcohol,
and the manufacture and aging of alcoholic species must be subject.
Article 55. Alcoholic concentrates, perfumes and pharmaceutical preparations are
not considered alcoholic beverages, but the alcohol included in the composition of
such preparations shall be subject to the tax established by this Law.

Article 56. The species taxed with the taxes established by this Law may not
circulate or be withdrawn from Customs, production establishments, manufacturing,
sales, warehouses, tax warehouses or general deposit warehouses except by means
of guides, invoices, certificates and other documents determined by the Regulations
of this Law.

Article 57. The business days and hours for carrying out operations of production,
packaging and shipping of ethyl alcohol, alcoholic species and any other related
activities will be determined by regulation.
The Ministry of Finance may authorize, for justified reasons, that such operations be
carried out outside of business days and hours, in which case the industrialists must
pay the remunerations provided for in article 64 of this Law.

Article 58. The Ministry of Finance may authorize redistillations or reprocessing of

alcoholic species, in justified cases, agreeing on the pertinent measures to
safeguard the interests of the National Treasury.
Authorization is not required for normal operations of this type carried out in the
production of alcoholic beverages.

Article 59. National producers of alcohol and alcoholic species must produce in one
calendar year at least the quantity of twenty-four thousand liters (24,000 liters)
computed at one hundred degrees of Gay-Lussac (100° GL). In the case of
production of alcoholic species by industries integrated into an industrial complex,
the minimum production quota will be calculated on the basis of the sum of the
total productions of the industrial complex.

For the purposes of this Law, when several producers carry out all or some of the
distillation, denaturation, preparation, manufacturing, fermentation, ageing and
packaging operations of alcoholic species in the same industrial establishment, they
are considered to be integrated into an industrial complex.
National producers of alcoholic beverages obtained in an artisanal manner from
plant raw materials, national producers of natural, mixed and mixed wines, and
beers, must produce in a calendar year at least the quantity of one thousand two
hundred liters (1,200 liters) in real volume.

Article 60. Industries that produce quantities less than those indicated in the
previous article will pay the difference in tax up to the amount corresponding to the
minimum indicated.

Article 61. In the production of alcoholic beverages, only the use of ethyl alcohol
derived from sugary materials of plant origin will be permitted.

Article 62. The National Executive will establish the definitions of the alcoholic
species taxed by this Law.

Article 63. Alcoholic beverages defined as brandy, whisky and rum may only be
offered for sale after two years of aging. When these species are intended for
export, they may be aged for a period of no less than six months.
Likewise, those alcoholic species added with a percentage not less than twenty
percent (20%) of their volume, referred to one hundred degrees of Gay-Lussac
(100° GL) of species of the same class with two or more years of aging, will be
classified under the aforementioned definitions, provided that they are intended for
export. In this case, the age of the product will be credited based on the youngest
aggregate aged species.
Species exported in accordance with the provisions of this article may not re-enter
the country.

Article 64. Tax officials who have been duly authorized to perform work related to
the performance of their duties during authorized hours in establishments
producing ethyl alcohol and alcoholic species may receive the remuneration that
corresponds to them, in accordance with the provisions of the Regulations of this
Law.

Article 65. The penalties established in article 108 of the Organic Tax Code shall
be applicable regardless of whether the alcoholic species are not taxed or are
exempt or exonerated from the tax established in this Law.

Article 66. Failure to comply with the provisions of this Law shall be sanctioned in
accordance with the provisions of the Organic Tax Code.

Article 67. The National Executive, through the competent body, will have forty-
five calendar days to draft and update the Regulations of this Law.

FINAL AND TRANSITIONAL PROVISIONS

Article 68. This Law will enter into force sixty calendar days after its publication in
the Official Gazette of the Bolivarian Republic of Venezuela.

Given, signed and sealed in the Federal Legislative Palace, headquarters of the
National Assembly, in Caracas, on the thirtieth day of the month of June of two
thousand and five. 195th year of Independence and 146th year of the Federation.

NICOLAS MADURO
MOROSPresident

RICARDO GUTIERREZFirst PEDRO

Vice President CARREÑOSec ond Vice President

IVAN ZERPA JOSE GREGORIO VIANA

GUERREROSecretary Undersecretary