Mexican Lawmaker Wants Foreign Digital Companies Subject to Tax

Mexico Congressman Representative Ignacio Campos recently introduced a bill to amend value-added tax (VAT) and income tax laws so foreign digital services companies have a tax domicile in the country. Rep. Campos based this legislation on most G-20 countries' implementation of rules for the collection of VAT on intangible goods. 

Tax Attorney Eugenio Grageda commented on the proposal's intended purpose of covering goods and services provided by digital economy companies. "Existing VAT law applies both to imports and to sales, the provision of services, and rentals that are carried out in Mexico," said Mr. Grageda. "However, in practice, the VAT that would otherwise be applicable to activities carried on through these digital platforms is not always collected."

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