The Mexican IRS -SAT- will sanction platforms such as Uber, DiDi, Amazon, Netflix, TikTok, Facebook, Zoom, and Spotify for not complying with their taxes.
MEXICO CITY (Milenio Diario) – The Fiscal Miscellany proposed by the Executive for the 2021 fiscal year establishes sanctions for digital platforms such as Uber, DiDi, Amazon, Netflix, TikTok, Facebook, Zoom, Spotify, among others, that do not comply with what is established, as well as the blocking of the digital seal for alleged billing companies and establishes guidelines for legal entities that carry out educational or sports activities without profit purposes.
According to what was published in the Parliamentary Gazette, although the Value Added Tax (VAT) Law contains a regulatory framework for the payment of this tax by digital service providers, experience shows that it is not sufficient to be an effective measure and achieve the desired compliance.
Therefore, it was considered necessary to establish a control mechanism that allows the tax authority to act when any company is reluctant to comply with its obligations. It was determined that when any digital platform resides abroad and must use the Internet access infrastructure of a national concessionaire, the latter can establish a mechanism that allows it to block access to its services.
This will happen when the digital service provider, resident abroad and without domicile in Mexico, does not register in the Federal Taxpayers Registry (RFC) before the Tax Administration Service (SAT), does not designate a legal representative and a domicile in the national territory or does not process its advanced electronic signature. The unblocking will be carried out until the moment in which said resident complies with the obligations mentioned above. The same sanction shall apply when the taxpayer fails to pay the tax, the entire amount of the withholdings in the case of digital services of intermediation between third parties, or monthly information returns during three consecutive months or two consecutive quarterly periods.
In this case, the registration in the RFC will also be canceled. The taxpayer will be removed from the list of registered digital service providers, both in the SAT’s web page and in the Official Gazette (DOF). From the date the blockade begins, the recipients of the country’s services will refrain from contracting future services.
When the obligations that gave rise to the blockade are complied with, the SAT, employing a resolution, will issue the order to unblock the corresponding public telecommunication network concessionaire in Mexico, so that within a maximum term of five days, it is complied with. Likewise, it must reinstate the taxpayer in the RFC and include him in the list of foreign residents without an establishment in Mexico registered as digital service providers. However, it is reiterated that a right of hearing is established before the blocking order.
The company may always comply with its obligations before the issuance of the order mentioned above. It is worth remembering that on June 1, the so-called “digital tax” came into force, which also requires digital platforms to register with the SAT. As of July 9, only nine signatures were registered, and on September 10, another 22 were added. The SAT will make known through the Official Gazette the new registrations within the first ten days of each month.
Cancellation of the Digital Seal
The Miscellaneous Fiscal Law that the Executive proposed to Congress for its approval also establishes the cancellation and temporary restriction of digital seal certificates to alleged companies that invoice simulated operations (EFOS), known as factureras. Likewise, some firms were part of a restructuring, spin-off or merger of companies, or a change of shareholders, so they cease to be part of the group and make the transfer of tax losses, an undue action since it erodes the income tax (ISR) base and prevents the payment of the contribution.
Although modifications to the Federal Fiscal Code have already been made, the procedure only has a temporary restriction; this implies that during the relief, the taxpayer could apply these bad practices and even disappear, since the procedure, although agile, implies a time that can be used to avoid the action of the authority. Therefore, the taxpayer must be limited to continue with bad practices to immediately render his digital seal certificate without effect; this does not violate his right to a hearing. He may distort the facts attributed to an adequate and reasonable term.
There is also a limit of 40 working days for taxpayers. The digital seal certificate was temporarily restricted to issue tax receipts via the Internet, to file a request for clarification to correct the irregularities or to distort the causes that led to the measure.
The acts or activities they perform must have tax vouchers, and the additional relevant documentation to avoid tax evasion.
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