New law might affect Steam in Mexico

[wawa wiwi]

Next year a new law will enter in Mexico that basically demands companies that offer digital services such as Amazon or Google to pay a special tax for it and to have headquarters inside the country. If the company doesnt do it, the sevice will get blocked inside the country. Does Valve have planned to do anything about that?

>inb4. use a VPN

https://www.xataka.com.mx/empresas-y-economia/morena-presento-su-iniciativa-gigantes-tecnologicos-paguen-iva-mexico-ahora-sera-retenido-instituciones

[aiusepsi]

With the caveat that I don't speak Spanish and so had to run it through Google Translate, this isn't anything to do with forcing foreign companies to pay a 'special' tax or to make them have a headquarters in Mexico, it's to make foreign companies charge VAT (or IVA, in Spanish) on the services they sell into Mexico, just like local companies have to charge you VAT. It's a playing-field leveller.

This is absolutely not a weird thing to do; the EU started requiring companies who sell services into the EU to charge VAT years ago, even if they don't have a EU presence.

Valve will do the same thing they've done whenever VAT or sales tax is required in a new jurisdiction: they start charging it. In practice, this doesn't really affect sale prices for reasons I can't really be bothered to get into. Basically, it just has the effect of cutting profit margins for Valve and devs.

[cSg|mc-Hotsauce]

So, sales tax just like the US did this year?

Ok.

It also did not change pricing of games or what cut they had.

I also do not advise the use of a VPN to get around it.

[Satoru]

Not particularly interesting as like 3 dozen countries already charge taxation on steam and digital purchases in general

Steam either

https://partner.steamgames.com/doc/finance/taxfaq

1) rolls that as part of the cut that is taken from devs because the steam price includes those taxes (this is the most common method)

2) the taxes are added on top of the sale price at checkout ( this is far less common and I think only the USA and Canada do this)

[aiusepsi]

Originally posted by cSg|mc-Hotsauce:

So, sales tax just like the US did this year?

Ok.

It also did not change pricing of games or what cut they had.

Sales taxes in the US are a little unusual because they are usually added on top of the advertised price rather than included in the price, so exactly what happens when the tax changes is a little different. But essentially, yeah.

[cSg|mc-Hotsauce]

Originally posted by aiusepsi:

Originally posted by cSg|mc-Hotsauce:

So, sales tax just like the US did this year?

Ok.

It also did not change pricing of games or what cut they had.

Sales taxes in the US are a little unusual because they are usually added on top of the advertised price rather than included in the price, so exactly what happens when the tax changes is a little different. But essentially, yeah.

Yeah. Still no tax on here in my state.

Does AUS include tax in the price? I forgot.

[Satoru]

Originally posted by cSg|mc-Hotsauce:

Originally posted by aiusepsi:

Sales taxes in the US are a little unusual because they are usually added on top of the advertised price rather than included in the price, so exactly what happens when the tax changes is a little different. But essentially, yeah.

Yeah. Still no tax on here in my state.

Does AUS include tax in the price? I forgot.

:qr:

Aus is inclusive

https://partner.steamgames.com/doc/finance/taxfaq

Its inclusive pretty much everywhere except the USA and Canada

Japan technically doesn’t have a law requiring either way, (the law only says you have to be clear if the price Includes or excludes tax) but steam rolls Japan’s taxation into the sale price

[cSg|mc-Hotsauce]

Thanks. Too lazy on mobile to click over to a browser.

[Satoru]

Originally posted by cSg|mc-Hotsauce:

Thanks. Too lazy on mobile to click over to a browser.

:rbiggrin:

Man I google translated the article and looked up all those things on my iPhone. Step up your game! 🤣

[cSg|mc-Hotsauce]

Originally posted by Satoru:

Originally posted by cSg|mc-Hotsauce:

Thanks. Too lazy on mobile to click over to a browser.

Man I google translated the article and looked up all those things on my iPhone. Step up your game! 🤣

Fat fingers have issues all over the place.

I need my tablet back.

[Ganger]

Sadly, it's the buyers who foot the bill in the end

[Your Mom's Oshi]

Originally posted by Ganger:

Sadly, it's the buyers who foot the bill in the end

For sales taxes? Of course.

[Arokhantos]

Tbh i think the amount of tax company pays should be based on its business in the country, not based on where its based, because that's how they dodge taxes, Mexico could play this a lot smarter but then again everyone should.

[GuRu Asaki]

I'm not really seeing why this is a huge problem?
In the past, I had issues with it, but now, it's just
another problem that has kinda been forgotten...

[Morphic]

Originally posted by cSg|mc-Hotsauce:

Originally posted by aiusepsi:

Sales taxes in the US are a little unusual because they are usually added on top of the advertised price rather than included in the price, so exactly what happens when the tax changes is a little different. But essentially, yeah.

Yeah. Still no tax on here in my state.

Same. Maybe we live in the same state? lol.

I'm really glad there's no Tax on digital goods but some of my friends in other states are complaining quite a bit. Kinda makes me wish USA would adopt the pricing structure of EU; where Tax is already included in the price tag. Though I just mentally add ~8% on top of the sticker price and ask myself if I still want it lol.