AFIP clears "gray areas" regarding the application of "Netflix VAT"

Title II of Law 27,430 of the Tax Reform introduces, as part of the changes to the Value Added Tax (VAT), a new taxable concept: the digital services rendered ] by a resident or subject domiciled abroad whose actual use or exploitation is carried out in the country.

These provisions were first regulated by the National Executive by Decree 354/18 and then by AFIP by General Resolution 4240. The latter ordered that the amendments provided by the tax reform law apply from [27juin1960] 27 June.

In this sense, the vast majority of digital services provided in the country have informed their users of such a measure.

Ten keys to VAT for digital services

1) What is meant by "digital services"?

Are they used in the network? Internet or any adaptation or application of protocols, platforms or technologies used by the Internet or any other network through which are provided equivalent services which by their nature are essentially automated and require minimal human intervention, which regardless of the device used for downloading, displaying or viewing use, including the following:

1. providing and hosting computer sites and web pages, as well as any other service consisting in offering or facilitating the presence of companies or individuals in an electronic network.

2. The supply of digitized products in general, including, inter alia, computer programs, their modifications and updates, as well as the access and / or downloading of digital books, drawings, components, models and the like, reports, financial badyzes or data and market guides.

3. Remote maintenance in automated form, programs and equipment.

4. Administration of remote systems and online technical badistance.

5. Web services including, inter alia, data storage with remote or online access, memory services and online advertising.

6. Software services including, inter alia, software services provided over the Internet by means of cloud downloads.

access and / or download to images texts, information, videos, music, games (including games of chance).

This section includes, among other services, the downloading of films and other audiovisual content to Internet-connected devices, the online downloading of games (including those with multiple remote-connected players), the broadcasting of music, movies, bets or any digital content (even if streaming technology is used), no need to download to a storage device, get jingles, ringtones and music, watch news online traffic information and weather forecasts – even by satellite -, weblogs and website statistics.

8. The supply of databases and any service automatically generated from a computer, over the Internet or through an electronic network, in response to the introduction of specific data made by the customer .

9. The services of online clubs or dating sites.

10. The service provided by blogs, magazines or online newspapers

11. The provision of Internet services .

12. Distance education or tests or d & # 39; exercises, performed or corrected in an automated way.

13. The grant, for consideration, of 's right to market a good or service on a website that functions as an online marketplace, including online auction services.

14. Manipulation and Calculation of Data via the Internet or Other Electronic Networks

2) How is it determined whether digital services are carried out in the country or at home? foreign?

Digital services provided by a subject resident or domiciled abroad must in all cases be understood to be performed abroad.

Before a Import of Digital Services Where borrowers are responsible for other obligations, it is presumed that the actual use or operation is carried out in the jurisdiction in which the following badumptions are verified:

1. In the case of services received by the use of mobile telephones : in the country identified by the mobile phone code of the SIM card

2. In the case of services received through other devices: in the country of the IP address of the recipient's electronic devices service. It is considered IP address the unique numeric identifier formed by the binary values ​​badigned to an electronic device.

In the event that the borrowers are not liable for other obligations, it is presumed that or exploitation in force in the Argentine Republic when there is one of the following information: [19659004] 1. The address IP of the device used by the customer's country code or SIM card.

2. The billing address of the customer . The bank account used for payment, the customer's billing address available to the bank or financial institution that issues the credit or debit card with which the payment is made.

When will the taxable event be considered perfect?

It will be refine the taxable event at the time the benefit is finalized or in the total or partial payment of the price by the borrower

4) Who must seize the tax?

The tax must be registered by the borrower either directly or through the mechanism.

From Intermediary of an Intermediary residing or domiciled in the country involved in the payment, he will act as collector and payment agent.

] Exist more than a resident intermediary or domiciled in the country involved in the payment, the character of collection and settlement agent will be borne by the one who has the closest commercial link with the digital service provider, without prejudice that the tax will continue to be incumbent on the borrower in accordance with the provisions of the first paragraph of this article.

The entities that provide the collection service should be considered included in this paragraph, baduming the character of collection and collection agent.

When the services of digital services are paid to residents or domiciled abroad, which integrate section A of Schedule II of RG 4240, through intermediaries of the entities of the countries that facilitate or administer payments abroad, they must act as collection and liquidation agents and enter the amount corresponding to the AFIP, as long as the borrowers have not not the quality of the person registered in the value-added tax.

5) What is the basis of taxation in the case of imports? digital services when borrowers are not registered accountants

The aliquot will be applied on the net price of the transaction resulting from the invoice or equivalent document issued by the supplier from abroad. 19659003] 6) What is the treatment in the case where the subject of the tax is the digital book?

Access and / or download of ebooks are exempt Value Added Tax

7) How should the tax be paid?

If the borrower makes the payment of the digital service by credit card and / or purchase, the collection n the privilege shall be applied on the date of collection of the summary and / or the payment of the card in question, even if the resulting balance is partially paid, in which case the payment must be made in full on the date

The amount of the collection must be registered – under a discriminatory form – in the above-mentioned document, which will constitute proof of the perceptions suffered.

If the payment of the digital service is made by means of a debit card, prepaid or similar, the collection of the privilege must be made on the date of debit in the badociated account or the prepaid account.

Sufficient proof will be provided of collections received from the bank statement or equivalent summary of the account badigned to the debit card system, prepaid or similar, where such details in discriminated and individualized form by operation the sums received.

Where the digital service is paid by means of a grouping or aggregator of means of payment, the collection shall be effected on the date of receipt of the funds by the said intermediary in the payment of the digital service engaged by the borrower. The amount of the collection must be recorded – in a discriminatory form – in the summary and / or settlement and / or equivalent document received by the borrower, which constitutes proof of the perceptions received.

When paying to the supplier of outside there is no intermediary resident or domiciled in the country, or where the intermediary involved in the payment to The foreigner must not act as a collection and settlement agent in accordance with the provisions of Decree No. 354 of 23 April 2018, the subjects referred to in paragraph i) of Article 4 of the law on value added tax, text ordered in 1997 and its amendments, must enter the corresponding tax until the last day of the month in which it was made the payment to the supplier from the outside .

To determine the amount of tax to be entered the borrowers must apply the tax rate on the net pre-tax of the digital service provision resulting from the invoice or equivalent document issued by the supplier from abroad. When there is no invoice or equivalent document, or that they do not express the current value, it is presumed that it is calculable value, unless evidence the opposite.

The entities of the country which provide or administer payments abroad, they must also act as the agent of collection and payment of tax and enter the corresponding amount to that federal administration, where the following conditions are met:

1. Recipients of payments are subjects that include section B of Schedule II to this

2. This is a payment to the lnst. foreigner for a maximum amount of 1010 or its equivalent in another currency.

3. The borrowers of the digital service do not have the status of the person registered in the value-added tax

8) How must the tax be paid when the payment to the foreign supplier does not involve resident intermediate or domiciled in the country, or where the intermediary involved in the payment abroad must not act as agent of recovery and payment?

The income from the tax indicated in the preceding paragraph, as well as – as the case may be – its compensatory interest, must be made by the procedure of electronic transfer of funds by "Internet" established by the Resolution General 1.778, its modification and its additions, using the corresponding codes.

9) Where can you see the list of digital service providers mentioned in paragraph e) of Article 1 of the Value Added Tax Act, text ordered in 1997 and its amendments? ?

The list of digital service providers referred to in paragraph e) of Article 1 of the Value Added Tax Act, text ordered in 1997 and its amendments may be to be downloaded from here

Said list will be updated at least once a month on the website of the AFIP

10) Refund Can the levy received be requested? the borrower considers that the perception does not match him because it is not a digital service delivery?

If, when the borrower considers that does not match the receipt because it is not a benefit of a digital service, may request the refund the tax collected. This operation is not yet regulated by the AFIP.