Título I. Del impuesto, objeto, sujetos, tasas y exenciones

An annual single tax is established on the value of immovable property located within the territory of the Republic.

The tax and fines referred to in this law belong to the municipalities of the country, for local development, and to the State, for municipal development, as follows:

a)The proceeds collected by the tax administration from the taxpayers subject to the two (2) per thousand rate shall be transferred in their entirety to the respective municipalities, and shall be entered as their own funds;

b)The proceeds collected by the Ministry of Public Finance from the taxpayers subject to the six (6) or nine (9) per thousand rate shall be distributed as follows: twenty-five percent (25%) to the State and seventy-five percent (75%) to the municipalities in whose territorial jurisdiction each real property is located, as exclusive funds. The resources derived from the application of the tax referred to in this law may be used by the municipalities only as follows: a minimum of seventy percent (70%) for investments in basic services and infrastructure works of collective interest and use; and up to a maximum of thirty percent (30%) for administrative operating expenses;

c)For those municipalities that do not have the technical and administrative capacity to collect and administer the tax, the Bank of Guatemala, as financial agent of the State, shall credit the amounts collected by the tax administration to the account named Impuesto Unico Sobre Inmuebles - Municipalidades (Sole Property Tax - Municipalities), and shall send to the Ministry of Public Finance a report of the amounts credited to the account, indicating the percentage that corresponds to the State and to the municipalities, respectively. Separately, the Bank of Guatemala shall issue a report to these municipalities on the amount that corresponds to them.

The Ministry of Public Finance shall deliver to the municipalities the amounts credited in their favor, derived from the amounts collected in each calendar month in their jurisdiction, within five working days following the end of the corresponding month.

d)For those municipalities that state that they have the technical and administrative capacity to collect and administer the tax, the Ministry of Public Finance shall expressly transfer such powers to them from the entry into force of this law. Consequently, the amount collected shall belong to the respective municipalities in the proportion of one hundred percent (100%), which they shall enter as exclusive funds, to be used as established in subparagraph b) of this article.

The tax established in this law is levied on rustic or rural and urban immovable property, comprising the land, structures, constructions, installations attached to the immovable property and its improvements, as well as permanent crops. For the purposes of determining the tax, the value of the following property shall not form part of the tax base:

1.Machinery and equipment.

2.In rustic or rural properties, the dwellings, schools, health posts, dispensaries or other social welfare centers for the workers of said properties.

For the purposes of this tax, permanent crops are deemed to be those with a production term exceeding three (3) years.

The tax base shall consist of the values of the various real properties belonging to the same taxpayer as the taxable person (sujeto pasivo) of the tax. For this purpose, the following shall be considered:

1.The value of the land;

2.The value of the structures, buildings and installations permanently attached thereto, and their improvements;

3.The value of permanent crops;

4.The increase or decrease determined by hydrological, topographical, geographical and environmental factors;

5.The urban, suburban or rural nature, population, location, services and other similar factors.

The value of an immovable property is determined:

1.By self-assessment submitted by taxpayers in accordance with the conditions referred to in this law;

2.By direct appraisal of each immovable property, carried out or approved by the Directorate or, as applicable, by the municipality when it is already administering the tax, in accordance with the appraisal manual prepared by the Ministry of Public Finance and through procedures previously approved by the Municipal Council;

3.By technical appraisal carried out by an appraiser authorized by the Directorate at the request of the owner; this appraisal must be submitted in a certification under oath, signed by the owner or his or her legal representative and the authorized appraiser; and,

4.By new values stated in the notarial notice resulting from the sale or transfer, under any title, of immovable property.

Where the values stated in the preceding numbered items are lower than the values recorded in the fiscal registration, they shall not be entered by the Directorate or the respective municipality.

Taxpayers and those liable, their attorneys-in-fact or legal representatives, shall file a self-assessment, as a declaration of the value of each real property, when summoned for that purpose by the Ministry or the respective municipality, which shall publish the corresponding dates and instructions. The mandatory nature of this declaration includes real properties that, as of the date this law enters into force, do not have an open tax registration record (matrícula fiscal). The Directorate or the municipality, as applicable, shall immediately proceed to reassess those real properties for which the self-assessment was not filed, and is empowered to engage authorized private appraisers in order to carry out this reassessment within a peremptory time period. The direct or indirect costs associated with the appraisal so contracted shall be charged to the account of the taxpayer according to a fee schedule authorized by the Ministry or the municipality and based on the value of the real property.

The self-assessments referred to in this article shall be received by the Directorate or the municipality, which shall review them on their own initiative, and may carry out such field inspections as they deem appropriate to verify the values stated therein.

In the event that adjustments to the values or corrections of data result, the procedure provided for in this law shall be followed.

In the event that a real property suffers deterioration that results in a partial decrease of its value, due to verifiable causes, the owner may submit a request to the administering entity so that the value in the registration record (matrícula) is modified, once the facts have been verified. The costs of the appraisal shall be paid by the interested party.

For the purposes of the obligations established in this law, taxpayers are the persons who own or possess immovable property and the usufructuaries of State property.

The following are jointly and severally liable, together with the taxpayers referred to in the preceding article, for payment of the tax:

1.Executors, representatives of an estate, heirs or legatees of the immovable property;

2.Trustees, for the immovable property administered in trust;

3.Usufructuaries of immovable property registered as such in the tax registry; and,

4.Individuals or legal entities, for the tax and fines owed as of the date of the acquisition of immovable property under any title.

The owners, possessors, lessees or managers of real property are obligated to:

1.Appear personally or through a legal representative at the summonses issued to them by the administering entity, stating the purpose of the proceeding; and,

2.Provide all pertinent information that is required of them for the establishment, updating and maintenance of the fiscal registration (matrícula fiscal).

For the determination of the annual tax on real property, the following scales and rates are established:

Registered Value Tax

Registered Value Tax

Up to Q. 2,000.00 Exempt

From Q. 2,000.01 to Q. 20,000.00 2 per thousand

From Q. 20,000.01 to Q. 70,000.00 6 per thousand

From Q 70,000.01 Onwards 9 per thousand

For the purposes of this tax, the following entities are exempt with respect to the immovable property that they own:

1.The State, its decentralized entities, autonomous entities, and the Municipalities and their enterprises;

2.The Diplomatic and Consular Missions of the countries with which Guatemala maintains relations, provided that reciprocity exists;

3.International organizations of which Guatemala is a member;

4.The Universidad de San Carlos de Guatemala and other universities legally authorized to operate in the country;

5.Duly authorized religious entities, provided that the immovable property is used for the worship they profess, or for social assistance or educational purposes, and that these services are provided on a general and free-of-charge basis;

6.Private Educational Centers intended for teaching, that carry out official study plans and programs;

7.Professional Associations;

8.The Confederación Deportiva Autónoma de Guatemala and the Comité Olímpico Guatemalteco;

9.The immovable property of cooperatives legally constituted in the country.