IGV Implementation on Digital Platforms
Since October 2024, Peru has applied an 18% sales tax (IGV: Impuesto General a las Ventas – General Sales Tax/VAT) to digital services provided by non-domiciled companies. This measure affects platforms such as Netflix, Spotify, Amazon Prime Video, and others, which now include IGV in their charges to Peruvian users. The SUNAT (Superintendencia Nacional de Aduanas y Administración Tributaria – National Superintendence of Customs and Tax Administration) estimates that this initiative will generate annual revenues of over US$200 million.
Objectives of This Measure
The IGV application to digital services aims to strike a balance between local and foreign providers, ensuring that all contribute fairly to the Peruvian treasury. Additionally, this action follows international recommendations and strengthens Peru’s position in its process of joining the Organization for Economic Cooperation and Development (OECD).
Responsibilities of Digital Platforms
Non-domiciled companies offering digital services in the country must register in the RUC (Registro Único del Contribuyente – Single Taxpayer Registry) and act as VAT collection agents, i.e, they must collect the tax when charging for their services and then declare and pay it to the SUNAT. To facilitate this process, the SUNAT has implemented Virtual Form No. 623 for stating and paying IGV through these platforms.
Impact on Consumers
Peruvian users of digital services have noticed an increase in the prices of their subscriptions and online purchases, reflecting the inclusion of IGV. Consumers must be informed about this adjustment to understand the changes in their bills and avoid awkward surprises.
Call to Action
If you are a user of international digital platforms, check your statements and familiarize yourself with these tax amendments. Keep informed and ensure that you understand how this tax affects your spending on digital services.
Source: El Peruano