Countries › Chile › Guide › 9. Trade and customs › Free zones in Chile: Iquique and Punta Arenas, goods treated as abroad, VAT and first category tax exemptions, and extension zones

Free zones in Chile: Iquique and Punta Arenas, goods treated as abroad, VAT and first category tax exemptions, and extension zones

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Last verified: 2026-10-26 · Status: Stable

Chile's free zone law authorises free zones in Iquique and Punta Arenas, fenced areas next to a port or airport where foreign goods are treated as if they were abroad, so they pay no customs duties or import VAT while they stay there and can be stored, processed, finished, sold and re exported without restriction. The operating company and users installed in the zones are exempt from VAT on operations inside them and from first category income tax, although they must keep Chilean accounts and their owners pay final income taxes on distributed profits. Goods leaving for the rest of Chile pay the normal import duties and VAT, and residents of the surrounding extension zones can buy most goods free of duties and VAT for use there.

USD figures use the Central Bank exchange rate of CLP 986.58 per US dollar published in the Diario Oficial for 23 October 2026. UTM based amounts use the October 2026 UTM of CLP 72,151 and UF amounts the UF of CLP 41,205.16 for 23 October 2026, both published by the SII. Conversions are for orientation only.

Key facts

Free zones authorised by law	Iquique and Punta Arenas textDFL Nº 2 of 2001 art. 1, as of 2026-10-26 · in force
Customs status of goods in a free zone	Treated as abroad; no duties or charges collected through Customs textDFL Nº 2 of 2001 art. 24, as of 2026-10-26 · in force
First category income tax for free zone users	Exempt; owners pay final taxes on profits textDFL Nº 2 of 2001 art. 23, as of 2026-10-26 · in force
VAT on operations inside the free zones	Exempt textDFL Nº 2 of 2001 art. 23, as of 2026-10-26 · in force
Goods leaving a free zone for the rest of Chile	Pay normal import duties and VAT; duties only on foreign parts for goods made in the zone textDFL Nº 2 of 2001 art. 10, as of 2026-10-26 · in force

The rule

1. Free zones are authorised in Iquique and Punta Arenas. A free zone is a clearly bounded area close to a port or airport, covered by a presumption of customs extraterritoriality, where goods may be deposited, transformed, finished or sold without restriction. The zones operate on sites set by Ministry of Finance supreme decree, and their administration and operation are entrusted by the State, through the Ministry of Finance, to companies under contract.Decreto con Fuerza de Ley Nº 2 of 2001, Ministerio de Hacienda, consolidated text of DFL Nº 341 of 1977 on free zones, Art. 1, art. 2 letter a), art. 3 and art. 11, 2001-08-10 official text · verified 2026-10-26

2. While goods remain in a free zone they are treated as being abroad and pay no duties, taxes, fees or other charges collected through Customs. Machinery used for the processes allowed in the zones or for moving goods inside them, and the fuel, lubricants and spare parts they need, enter under the same exemption. Chilean or nationalised goods of all kinds may also enter the zones.
Cost to do it: No duty and no import VAT on entry; services provided in the zone are charged by the operator and users.
Example: Goods worth CLP 98,658,000 CIF entering the Iquique free zone pay no duty (CLP 5,919,480 under the general regime) and no import VAT. / US$100,000 of goods avoid US$26,140 of duty and VAT at entry, deferred until they enter the rest of Chile, if they ever do.Decreto con Fuerza de Ley Nº 2 of 2001, Ministerio de Hacienda, consolidated text of DFL Nº 341 of 1977 on free zones, Art. 10 bis and art. 24, 2001-08-10 official text · verified 2026-10-26

3. The operating company and the users installed in the free zones are exempt from VAT on operations carried out inside the zones and from first category income tax on their profits. They must keep accounts under Chilean law so that their owners can pay the final income taxes (global complementario or additional tax) on their share of profits. Owners of companies under the regime of article 14 letter D Nº 8 of the Income Tax Law may use 50 percent of the first category tax credit in their final taxes, as if the company's base had been taxed.
Cost to do it: No first category tax at company level; owners pay final taxes on profits, without the usual credit except as stated.Decreto con Fuerza de Ley Nº 2 of 2001, Ministerio de Hacienda, consolidated text of DFL Nº 341 of 1977 on free zones, as amended by Ley Nº 21.210, Art. 23, 2020-02-24 official text · verified 2026-10-26

4. Goods may leave the free zones to be re shipped or exported abroad without restriction, or be imported into the rest of Chile under the general or special rules. For products assembled, processed or manufactured in the free zones, import duties apply only to the foreign parts and pieces that were not nationalised, but the Chilean or nationalised parts also pay VAT. Customs may examine the goods inside the zones.
Cost to do it: Normal 6 percent duty (or the trade agreement rate) and 19 percent VAT when goods enter the rest of Chile.
Example: A buyer in Santiago importing CLP 98,658,000 of goods from the Iquique free zone pays CLP 5,919,480 of duty and CLP 19,869,721 of VAT, as for any import. / US$6,000 of duty and US$20,140 of VAT on US$100,000 of goods.Decreto con Fuerza de Ley Nº 2 of 2001, Ministerio de Hacienda, consolidated text of DFL Nº 341 of 1977 on free zones, Art. 10, 2001-08-10 official text · verified 2026-10-26

5. The free zones were extended outside their fenced areas into extension zones. Goods not on a list of excluded goods set by Ministry of Economy decree may be bought there free of duties, fees and other charges collected by Customs and of VAT, and must be used or consumed in the extension zone; later sales inside the extension zone are subject to VAT. Goods may also be bought in the Iquique free zone free of all taxes for use or consumption in the First Region. Shipment abroad or import into the rest of the country of those goods follows the general rules, with duties on foreign parts only for goods assembled or manufactured there.
Cost to do it: No duty and no VAT on qualifying purchases for use in the extension zone.Decreto con Fuerza de Ley Nº 2 of 2001, Ministerio de Hacienda, consolidated text of DFL Nº 341 of 1977 on free zones, Art. 21 and art. 21 bis, 2001-08-10 official text · verified 2026-10-26

6. Removing goods from or bringing goods into the free zones or the extension zones in breach of this law is the crime of contraband or customs fraud under the Ordenanza de Aduanas. Separately, the Ordenanza's customs deposit regime with minor processing does not apply in a region where a free zone is located.
Cost to do it: Contraband fines of two to five times the value of the goods, plus prison above 20 UTM (CLP 1,443,020) of goods value.Decreto con Fuerza de Ley Nº 2 of 2001, Ministerio de Hacienda, consolidated text of DFL Nº 341 of 1977 on free zones; Decreto con Fuerza de Ley Nº 30 of 2004, Ordenanza de Aduanas, DFL Nº 2 art. 22; Ordenanza de Aduanas art. 111 bis, 2001-08-10 official text · verified 2026-10-26

Stage	Duty	VAT
Entry into the Iquique or Punta Arenas free zone	None	None
Sale between users inside the zone	None	Exempt
Re export abroad	None	None
Purchase for use in the extension zone (goods not on the excluded list)	None	None
Import into the rest of Chile	US$6,000 (CLP 5,919,480), or the trade agreement rate	US$20,140 (CLP 19,869,721)

Tax treatment of a US$100,000 (CLP 98,658,000) shipment of foreign goods at each stage (DFL Nº 2 of 2001; 6 percent general duty and 19 percent VAT).

Worked example

A regional distributor stores US$100,000 (CLP 98,658,000) of electronics in the Iquique free zone, paying no duty or VAT on entry (DFL Nº 2 art. 24). It re exports half to neighbouring markets with no Chilean duty or VAT.
It sells the other half to a retailer in Santiago, which imports it into the rest of Chile and pays 6 percent duty and 19 percent VAT on that half, US$3,000 and US$10,070 (CLP 2,959,740 and CLP 9,934,861) (art. 10).
As a user installed in the zone, the distributor pays no first category tax on its profits, but its owners pay final income taxes on distributed profits (art. 23).

Step by step

1. Confirm with the operating company of the relevant free zone the available sites and the user contract terms.
2. Register the company with the SII and keep Chilean accounting, which the law requires to tax owners on profits.
3. Bring goods in under the free zone procedures set by Customs; they remain foreign while in the zone.
4. For each sale, decide the destination: re export, sale to other users, sale for use in the extension zone or import into the rest of Chile with full duties and VAT.
5. Keep records of goods entering and leaving, since removing goods outside the rules is contraband.

Common traps

Assuming goods bought in an extension zone can move freely to the rest of Chile: they must be used there, and taking them elsewhere requires a normal import.
Forgetting that VAT applies on the Chilean parts of products made in a free zone when they enter the rest of Chile.
Expecting owners to be tax free: only the company level first category tax is exempt; owners pay final taxes on profits.
Planning a customs deposit with minor processing in the regions of Iquique or Punta Arenas: that regime does not apply in a region where a free zone is located.

Sources

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