VALUE ADDED TAX LAW

24/10/2020

DIGITAL ECONOMY

ARTICLE 18-B. Services that are taxed

The second paragraph of section II of this article is eliminated, which discards the exclusion that indicates that digital intermediation services that have as their object the sale of used movable property, will not be considered as such for the purposes of the obligations provided. in the Chapter on the provision of digital services.

In accordance with the explanatory memorandum, it is intended to generalize the treatment that should be given to the sale of goods made through intermediation platforms, that is, to tax the service provided by the platform regardless of whether they are intended to sell used movable property. .

ARTICLE 18-D. Obligations of residents abroad to provide digital services

A third paragraph is added to establish as a facility that residents abroad without an establishment in Mexico, who provide the digital services referred to in sections I, III and IV of article 18-B (download or access to images, films , text, information, video, audio, music, games, obtaining mobile tones, viewing online news, weather forecasts and statistics; online clubs and dating sites, as well as distance learning), will not be required to comply with the obligations set forth in this article, provided that the aforementioned digital services are provided through digital mediation platforms referred to in section II of article 18-B and the latter make them withhold VAT at 100 % in the terms of article 18-J,section II, subsection a), second paragraph (which is also added)

ARTICLE 18-J. VAT withholding and other obligations of the providers of the digital intermediation service

The following is added:

• A second paragraph to section I, which incorporates the option for digital mediation platforms of Publish on its website, application or platform, the price at which the goods or services are offered by the disposers, service providers or grantors of the temporary use or enjoyment of goods, in which they operate as intermediaries, without manifesting VAT in the form expressly and separately, as long as the prices include VAT and are published with the legend “VAT included”.
• A second paragraph to subsection a) of section II to establish that in the case of residents abroad without an establishment in Mexico, who provide the digital services provided in article 18-B, sections I, III and IV of this Law, the providers of the digital intermediation service must retain 100% of the VAT charged. In this case,When the recipient requests it, they must issue and send electronically to the recipients of the aforementioned digital services in national territory, the vouchers referred to in section V of article 18-D of the Law VAT, either in the name of the person to whom the withholding is made or in their own name.
• A fourth paragraph to fraction III to indicate that nor there will be an obligation to provide the information referred to in this section, in the case of residents abroad without an establishment in Mexico who provide the digital services provided for in article 18-B, sections I, III and IV of this Law, to the That the withholding be made in the terms of section II, subsection a), second paragraph, of this article.

The consequences of non-compliance with the obligations provided in the VAT Law, by residents abroad without an establishment in Mexico, are incorporated into the Law, with the addition of the following articles:

ARTICLE 18-H BIS.- Cases in which the temporary blocking of access to the digital service proceeds

Failure to comply with the obligations referred to in sections I, VI and VII of article 18-D of this Law (register in the RFC, designate a legal representative and provide an address in national territory and process the electronic signature) by residents abroad without establishment in Mexico that provide the digital services provided for in article 18-B of this Law, to recipients located in national territory, will result in temporarily blocking access to the digital service of the provider of digital services that breached with the obligations, blockade that will be carried out through the concessionaires of a public telecommunications network in Mexico, until such time as said resident complies with the omitted obligations.

The sanction referred to in the previous paragraph will also be applied when the resident abroad fails to pay the tax or the full amount of the withholdings that must be made, as well as the presentation of the payment and informative declarations to which they refer. Articles 18-D, section IV, and 18-J, sections II, subsection b) and III of this Law for three consecutive months or for two consecutive quarterly periods, in the case of the informative return referred to in section III of article 18-D cited.

Additionally, when the cases referred to in the previous paragraph arise, the registration in the RFC referred to in article 18-D, section I, of this Law will be canceled and the list of residents in the foreigner registered, both on the SAT page and in the Official Gazette of the Federation (DOF)

The penalties referred to in this article are independent of those corresponding to the omission in the payment of the tax, in the whole of the withholdings and in the presentation of the payment and informative declarations, in accordance with the provisions of article 18- G of this Law.

ARTICLE 18-H TER.- Procedure prior to the issuance of the blocking order

For the purposes of the provisions of article 18-H BIS of this Law, prior to the blockade, the SAT will inform the taxpayer of the resolution determining the breach of the obligations in question.

In the case of non-compliance with the obligations referred to in sections I, VI and VII of article 18-D, the resolution will be announced by publication in the DOF and, in the case of those established in articles 18-D, sections III and IV, and 18-J, sections II, subsection b) and III of this Law, the resolution will be notified to the legal representative of the resident abroad without establishment in Mexico, in order that the taxpayers can declare before the tax authority what that it is appropriate to their right and provide the documentation and information that they consider pertinent to disprove the facts that gave rise to the aforementioned determination, within a period of fifteen days from the day following the corresponding publication or notification.In said manifestation, the taxpayer must indicate an address to receive notifications within the national territory or an email for the same purpose.

Taxpayers may request, through the means authorized by the SAT through general rules, for a single occasion, an extension of five days to the term provided in the previous paragraph, to provide the respective documentation and information, provided when the request for an extension is made within that period. The extension requested in these terms will be understood to be granted without the need for a pronouncement by the authority and will begin to compute from the expiration of the previous term.

After the aforementioned deadlines, the authority, within a period that will not exceed fifteen days, will assess the documentation, information or statements that have been asserted and will notify the taxpayers of their resolution at the address or email that they have indicated when submitting their writing. for clarifications. Failing that, the notification will be made by publication in the DOF.

Within the first five days of the period referred to in the preceding paragraph, the authority may require additional documentation and information from the taxpayer, which must be provided within the period of five days after the notification of the requirement takes effect. In this case, the aforementioned period of fifteen days will be suspended from the date the notification of the request takes effect and will resume the day after the said period of five days expires.

Once the period referred to in the previous paragraph has elapsed, without the taxpayer having proven compliance with the tax obligations provided for in articles 18-D, sections I, III, IV, VI and VII, and 18-J, sections II , subsection b) and III, of this Law, as the case may be, the temporary blocking of access to the digital service will be ordered, which will be lifted once the omitted obligations are met.

ARTICLE 18-H QUATER.- Obligations of the concessionaire of public telecommunications networks

For the purposes of the provisions of articles 18-H BIS and 18-H TER of the VAT Law, the temporary blocking must be ordered to the concessionaires of a public telecommunications network in Mexico, through a duly founded and motivated resolution, issued by public official with the position of general administrator in accordance with the provisions of the Internal Regulations of the Tax Administration Service. Regardless of the foregoing, said deconcentrated body may request the assistance of any competent authority to carry out the temporary blockade referred to in this article.

The concessionaire of the public telecommunications network in Mexico in question will have a period of five days from the day following the day on which the notification of the resolution in which the temporary blocking of access to the digital service, to carry out the corresponding temporary blocking and must report compliance with said temporary blocking to the tax authority no later than the fifth day following the one on which it was carried out.

ARTICLE 18-H QUINTUS. Posting Blocked Taxpayers and Unblocking Order

For the purposes of the provisions of articles 18-H BIS, 18-H TER and 18-H QUÁTER, the SAT will announce on its website and in the DOF the name of the provider and the date from which The access to the digital service must be temporarily blocked, so that the recipients of the services in the national territory refrain from contracting future services.

When the taxpayer complies with the obligations that gave rise to the temporary blocking of access to the digital service, the SAT, through resolution, will issue the unblocking order to the corresponding concessionaire of a public telecommunications network in Mexico, so that within a maximum period of five days is completed. Said order must be issued by the general administrator who has ordered the temporary blocking. Likewise, said decentralized body must reincorporate the taxpayer in the Federal Taxpayers Registry and include him in the list referred to in article 18-D, section I, of the VAT Law.