Let’s get this straight once and for all. The law in Bolivia is clear: foreign tourists do not pay the 13% IVA hotel tax in Bolivia (we’d call this a VAT or Value Added Tax in English). However, every hostel we’ve stayed at in La Paz has slyly added this tax onto our bill. Because we’re allergic to any type of travel scam (and on a tight travel budget) we’ve argued the tax and managed to have it removed from our bills. But it’s no fun feeling ripped off and it’s no fun arguing, so we did a lot of leg work so you can easily avoid being overcharged at hotels and hostels when you travel to Bolivia.
Avoid this rip-off hotel tax in Bolivia
Foreign tourists are exempt from the IVA hotel tax in Bolivia because the hotels themselves are not required to pay the tax for foreign guests (only for Bolivian guests). So, every time a hotel incorrectly charges a foreign guest 13% on top of their hotel bill they can pocket that money which can add up to thousands of dollars a year at a busy hostel or hotel. Yeah, that makes us mad too.
We got sick of arguing about the tax law with hotel staff so we set out to get our hands on official Bolivian government documents that spell out the law which says foreign tourists are exempt from the IVA hotel tax. It wasn’t easy, but after asking reputable hoteliers, contacting the Bolivian Vice-Ministry of Tourism, and talking to the tourism police in La Paz we finally collected the necessary documents.
We’ve put together a PDF for you to download, printout, and show to any Bolivian hotelier that tries to charge you the tax. The first two pages of this document are from the Bolivian Tax Authority and they were sent to us by the Bolivian Vice-Ministry of Tourism. These docs explain how hotels handle the foreign tourist tax exemption. The third page is a printout from the Bolivian Tax Authority’s website and it more clearly addresses the foreign tourist exemption. The fourth and final page is the relevant portion of the specific law that exempts foreign tourists from the tax.
So far we’ve only encountered problems with this tax in La Paz. Perhaps it’s less of an issue in other areas of Bolivia. But we still recommend that you use our link, print out these official documents, carry them with you, and show them to any hoteliers who insist on charging you this tax.
If you get any guff or are ultimately somehow forced to pay the tax, you can also denounce hotels by giving the hotel name and details of the interaction to the local tourist police office (though when we visited the tourist police office in La Paz to denounce Rendezvous Hostal and La Posada de la Abuela Obdulia for trying to charge us for the tax, we were referred to the nearby Camara de Hoteleras office). Just the threat of denouncing a hotel to the tourist police is usually enough to get the tax dropped from your bill.
We’ve been using Booking.com a lot lately and the site has a statement on every Bolivian hotel listing that explains that foreign travelers are exempt from the IVA tax (see above), though we believe the in-country stay limit is under 183 days, not under 59 days as the Booking.com blurb states. Regardless of the Booking.com statement, both of the La Paz hostels we booked via the site tried to charge us the tax. If you use Booking.com, leave reviews of properties that try to charge you so that other travelers can be aware and so that Booking.com can be aware.
We just got off the phone with a Booking.com customer service rep who explained that every property on the site has an internal rep who is interested in tracking and resolving any habitual problems, like charging foreign guests for taxes they don’t have to pay. To be super diligent, send a message to the Booking.com customer service email address as well if a hotel or hostel tries to charge you this tax.
Here’s more about travel in Bolivia
Here’s $20 off your first stay with Booking.com
Thanks for sharing this with your readers … when I head to Bolivia, I will have these documents in my day bag!
I just asked a La Paz hotel about it and sent them this link. Definitely will not stay at any place charging me VAT. Tipping generously is one thing (it’s my choice), but being ripped off and coerced to pay money that’s not legally due is a big NO in my book.
Hey Ben, we’re so glad the information in our post was useful!
I’ve just been overcharged after one hour of arguing and the owner even rang booking.com who confirmed we don’t pay tax. He hang up on them and threatened to chuck us out on the street if we didn’t pay, so had to pay. The hostel kept arguing saying that we’ve made up the price and they don’t understand tax. Can’t believe any Gringoes before us had never challenged this. Just emailed them the document but it will probably fall on deaf ears….
We’re really sorry you’ve had to have this argument with the hostal. Can you tell us which hostal and in which city? That might help others avoid doing business with them. And did you print out the documents in this post and show them to the hostal manager/owner? If you are in Lima you can also report the hostal to the tourist police and it sounds like you’ve already made booking.com aware of the fraudulent practices of the hostal, so that’s good. Most of all, get on with enjoying the rest of Bolivia!
Thanks. Very useful!