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Mexico tightens VAT rules on non-resident digital services

Mexico has proposed two changes to the Value Added Tax obligations on foreign providers of digital services to its consumers:

  1. Move from quarterly VAT returns to monthly reporting
  2. Raise fines on providers who fail to submit returns for three consequative filings

Mexico VAT on digital services was introduced in June 2020. There are now 110 digital service providers on Mexico’s list of digital service providers required to submit returns.

The measures were announced on 8 September 2021 as part of the 2022 economic proposal by the President to Congress.

VAT Calc’s global VAT and GST on digital services blog keeps a live update on how countries are imposing indirect taxes on non-resident providers and electronic marketplaces.

North America VAT on digital services

Comments (click for details) Rate Implementation Date Threshold Comments
Canada 5% Jul 2021 C$30,000
Canada British Columbia 7% Apr 2021 C$10,000
Canada Manitoba 7% Dec 2021 B2C; accommodation sharing
Canada Quebec 9.98% Jan 2019 C$30,000
Canada Saskatchewan 6% Jan 2019 Nil for non-residents
Mexico 16% Jun 2020 Nil
United States Up to 10% 2018+ Varies by state

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