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Mexico foreign e-commerce VAT proposal 2020

  • VAT
  • Jul 25, 2019 | Richard Asquith

The Mexican Senate is to be presented with a proposal to levy 16% VAT on digital services purchased on non-resident platforms. This would affect online platforms including Uber, Netflix and AirBnB.  They would be required to VAT register as a non-resident, collect Mexican VAT and file returns.

The measure would come into force in April 2020.

The proposal could also impose the requirement for payment providers to withhold any VAT due, and remit directly to the tax authorities – following the new Argentinian model. Colombia and Uruguay also impose VAT on foreign platforms, plus Europe and much of the Asia Pacific region.

In Mexico, Uber and many other ride sharing and food delivery sites already withhold income tax from their drivers’ payments.

The VAT measure is to be put forward by a member of the budgetary committee. The aim is to implement the change in indirect rules early 2020. Mexico is facing a sizeable drop in revenues this year from the struggling state oil company, Pemex.


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VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.
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