Uruguay to start taxing digital services

The modifications included in the Accountability, approved during 2017, went into effect this Month in Uruguay. The reform includes taxing digital services such as Netflix and Spotify, among others. However, it is not yet regulated.
According to local newspaper El País, the government did not estimate how much it could collect, but unofficially the figure is expected to be close to USD 10 million per year. According to the modifications introduced, companies must pay the Income and VAT taxes for the activities they carry out in the country or partially abroad.
Specialists consulted by El País said that the problem with digital platforms is that “you have to regulate how you are going to charge the taxes.” “Maybe they are looking for Netflix, Airbnb, etc. to sit down at a table (as happened with Uber and the other transport services) to see if they start paying for it, if not, a retention mechanism will be needed,” said Federico Camy, partner of Guyer & Regules.