Vanuatu VAGST Guide: 12.5% Standard Rate, Registration Threshold VUV 3M 2026
Vanuatu imposes a Value Added Goods & Services Tax (VAGST) at a standard rate of 12.5%. Businesses with annual taxable turnover exceeding VUV 3,000,000 must register. The 12.5% rate applies to most goods and services, with exports and international services zero-rated. Here is how VAGST works in 2026.
VAGST is Vanuatu's primary source of tax revenue, introduced in 1998 and administered by the Vanuatu Revenue & Customs (VRC). Unlike many countries that have multiple VAT rates, Vanuatu has a single standard rate of 12.5% with zero-rated supplies for exports. The system follows a broad-based consumption tax model. VAGST applies to both goods and services, with limited exemptions for financial services, education, and healthcare. The fiscal year is the calendar year. Corporate tax overview →
Real-world example: A Port Vila retailer sells goods worth VUV 100,000. VAGST at 12.5% = VUV 12,500, total invoice VUV 112,500. The same retailer imported the goods for VUV 60,000 and paid VAGST of VUV 7,500 on import. The retailer remits VUV 5,000 to VRC (output tax VUV 12,500 minus input tax VUV 7,500). An exporter of vanilla beans with VUV 500,000 in exports charges 0% VAGST but can reclaim input tax on related costs. VAGST filing guide →
VAGST Rates
- 12.5% (standard rate): Most goods and services including retail sales, hospitality, professional services, construction, vehicles, electronics, and consumer goods
- 0% (zero rate): Exports of goods, international transportation, supplies to diplomatic missions, and certain international services
- Exempt: Financial services (banking, insurance), education, healthcare, residential rental accommodation, and basic food staples
Vanuatu's 12.5% rate is moderate by international standards, lower than Fiji (9% VAT + VAT on services), New Zealand (15% GST), and Australia (10% GST). The single-rate system simplifies compliance.
VAGST Registration
- Mandatory registration: Annual taxable turnover exceeds VUV 3,000,000
- Voluntary registration: Businesses below the threshold may voluntarily register
- Registration threshold: VUV 3,000,000 in annual taxable supplies
- Non-resident registration: Foreign businesses supplying goods or services in Vanuatu may need to register
Registration is done through the VRC. VAGST returns are typically filed monthly or quarterly depending on turnover. Failure to register when required results in penalties and back-assessment of VAGST.
VAGST Compliance and Filing
- Filing frequency: Monthly for larger businesses, quarterly for smaller registered businesses determined by VRC
- Filing deadline: Returns are due within 30 days after the end of the tax period
- Payment deadline: Same as filing deadline for VAGST due
- Electronic filing: VAGST returns are filed electronically through the VRC portal
- Records: Businesses must maintain invoices, receipts, and accounting records for at least 7 years
Late filing incurs penalties. Late payment incurs interest. The VRC conducts VAGST audits and cross-checks invoices through the tax invoice system.
Imports and Customs Duties
VAGST is applied on imported goods at the point of entry, calculated on the customs value plus import duty. In addition to VAGST, Vanuatu imposes import duties (customs tariffs) on many goods at varying rates. Import duties are separate from VAGST. Businesses registered for VAGST can claim input tax credits on VAGST paid at import.
Can non-resident businesses reclaim VAGST?
Yes. Non-resident businesses not registered for VAGST in Vanuatu may reclaim VAGST incurred on business expenses incurred in Vanuatu. The refund procedure requires documentation of the VAGST paid and proof of non-resident status.
What is the penalty for late VAGST filing?
Late filing penalties apply: VUV 10,000 for the first month late plus VUV 5,000 for each additional month. Interest on late payment accrues at the prescribed rate. Persistent non-compliance may result in business license suspension.