Mexico’s Congress has approved the 2020 Budget proposal under which non-resident entities that provide digital services to Mexican recipients will be obliged to register and account for 16% local VAT on such supplies.
The new provisions specifically include services such as the downloading of images, movies, text, videos, games, data storage, and online training, as well as mediation between unrelated parties for the acquisition of goods or services.
A recipient will be considered as being located in Mexico if their domicile is in Mexico, payment is made through a national intermediary (bank), or if the IP address used in the electronic device receiving the services is located within Mexico.
The new rules had been scheduled to take effect from 1 April 2020, but will now take effect from 1 June 2020.
Source Linkedin
