VALUE ADDED TAX
1 .10.13
WHAT IS VALUE ADDED TAX (VAT)?
 A tax on the purchase of a good or service
 Usually seen in the European Union, but also in Asia
 Generally between 15%-25%
DO WE HAVE TO PAY THIS TAX?
 No, but it may be dif ficult to avoid
 You can try to get a refund at the airport
 Best option is to buy item through the internet when you get
back
 Note: The UW does not have a VAT number
RESPONSIBILITIES - DEPARTMENT
 Check award documentation to see if VAT is or is not
allowable.
 For any awards from NIH or other DHHS agencies (CDC, HRSA, etc.),
the VAT would not be allowed because the foreign component of
those awards is significant. VAT would need to be paid from non sponsored funds. See sample NIH language below:
 Customs and Import Duties: Allowable under grants to domestic
organizations when performance will take place entirely within the
United States, its possessions, or its territories, or when foreign
involvement in the project is incidental to the overall grant -supported
project. Charges may include consular fees, customs surtaxes, valueadded taxes, and other related charges. Consular fees, customs
surtaxes, value-added taxes, and other related charges are
unallowable on foreign grants or the foreign component of a
domestic grant.
RESPONSIBILITIES – DEPARTMENT,
CONTD.
 Review prior purchases that include VAT and transfer any
unallowed VAT of f of the grant.
 Since OMB does not address these particular taxes, for other
federal sponsors, review the particular terms and conditions
to see if VAT is addressed. If no, then apply the general
principles of allowability: reasonable, allocable, and
consistent treatment.
RESPONSIBILITIES – CENTRAL OFFICES
 Communicate the policy to campus and advise them on what
they need to do to ensure they are only charging allowable
costs to their grants
 Field questions (EIO/GCA Compliance/UW Tax Of fice)
CONTACT INFORMATION
 UW Tax Department taxofc@uw.edu or 206.685.0571
 Equipment Inventory Of fice Erin Fujiwara efuji@uw.edu or
206.543.9859