Netflix and Spotify prices will rise in Mexico if VAT is applied

The Federal Government proposed in its Economic Package for nest year that some services and apps will have to pay taxes, so Netflix, Uber, Spotify and other electronic platforms could be increasing their prices as a consequence of this measures.

According to the Secretary of the Treasury (Secretaría de Hacienda y Crédito Público), the collection of taxes would begin as of April 1, 2020, so companies have enough time to inform their customers that their services wil be raising prices, as they will include VAT (IVA).

According to information from Forbes Mexico, the following could be the price list of three of the most popular electronic platforms in Mexico (considering a 16% VAT rate).


NETFLIX

Basic Plan (for a single TV, no HD); from $129 to $146.16 Mexican pesos a month.
Standard Plan (for two TVs, HD): from $169 to $196.04 Mexican pesos a month.
Premium Plan (for four TVs, Ultra HD): from $229 to $265.64 Mexican pesos a month.

Spotify
The price for the individual Plan would go from $99 to $114.84 Mexican pesos a month.
Premium family plan: from $149 to $172.84 Mexican pesos a month.

Amazon Prime
The price would go up from $99 to $114.84 Mexican pesos a month.


The Economic Package for 2020 also proposes:

  • Raise quotas for soft drinks and tobacco.
  • Fewer economic resources for Tourism and Presidency.
  • More economic resources for the National Guard and Pemex.

AMLO said just a couple of days ago that no new taxes will be created, but apparently “different fiscal measures” will be taken.  The project delivered by the Executive for the analysis and discussion of the Congress of the Union does not propose to create taxes or raise the rate of existing ones, but again, it contains a package of “fiscal measures” to increase collection and combat tax evasion (isn’t that creating new taxes?).

The Secretaría de Hacienda y Crédito Público estimates that the collection of taxes will amount to 3.5 billion pesos in 2020.

The Yucatan Times Newsroom



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