An inquiry has been made as to whether the non-applicability provided for in subsection g) of article 2 of the Consolidated Text of the General Sales Tax and Selective Consumption Tax Law applies to pilot training services provided by Civil Aeronautical Training Centers duly authorized and certified by the General Directorate of Civil Aeronautics of the Ministry of Transport and Communications.
Non-Applicability of IGV
Subsection g) of article 2 of the Consolidated Text of the IGV Law establishes that transactions carried out by public or private educational institutions are not subject to IGV, provided that they are performed for their own purposes. It also states that the specific list of goods and services not subject to tax is established by Supreme Decree.
In this regard, Supreme Decree No. 046-97-EF contains that list, both for domestic transactions and for imports.
Therefore, the non-applicability of IGV only applies if two conditions are met: (i) that the entity concerned is an educational institution, and (ii) that the good or service is expressly included in that decree.
Nature of the Entities Involved
Civil Aeronautical Training Centers (CIAC) for the training of flight crew members and flight dispatchers fall within the scope of the Transport and Communications sector, and their authorization to operate, as well as their regulation, are under the responsibility of the DGAC of the MTC.
In this regard, since CIAC are not included within the scope of the Education sector, it may be concluded that they do not constitute public or private educational institutions under subsection g) of article 2 of the Consolidated Text of the IGV Law and, therefore, the non-applicability provided for in that rule does not apply to them.
Does the Non-Applicability of IGV Apply to Pilot Training Services?
No. The non-applicability of IGV does not apply to pilot training services provided by CIAC.
This is because such entities do not qualify as educational institutions under subsection g) of article 2 of the Consolidated Text of the IGV Law, since they are not part of the educational system nor under the scope of the Education sector, but rather under the Transport and Communications sector.
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