Article 31, section IV, of the Political Constitution of the United Mexican States provides that we all have the obligation to contribute to public spending by paying taxes, rights, contributions for improvements and social security contributions, which must be equitable and proportional.
The income that is captured by each of these four types of contributions has different particularities and purposes, but they all agree that their purpose is to cover the needs of the population.
During the seventies, the VAT or value added tax already existed in practically all the countries of the world. In Mexico, it arises with the publication of the Value Added Tax Law on December 22, 1978, entering into force on January 1, 1980.
VAT is a tax of an indirect nature that taxes consumption.
In other words, the purpose of VAT is to tax acts or activities such as the sale of goods, the provision of independent services, the leasing of goods and the importation of goods and services.
The understanding of VAT for those of us who are not experts in the matter is more complex and therefore difficult to understand than that of the direct taxes that are levied on the increase in assets such as income tax or ISR.
Let’s take an example: As a lawyer, I charge a client one hundred thousand pesos for my professional services. In the same month that they pay me, I had expenses of fifty thousand pesos, which, because they were necessary for the performance of my services, I could deduct, as payment of office rent, stationery, gasoline, etc. Therefore, my income less deductions in that month was fifty thousand pesos, not one hundred thousand. ISR is calculated based on what actually increased my assets, which were fifty thousand pesos, on which I have to pay said tax according to the rate that applies to me (30%).
However, following the same example, VAT is calculated on the one hundred thousand pesos, which was my gross income without deductions, on the rate of 16% (because it is not a border area in which the percentage is lower for reasons of competitiveness) This is because what is levied by this tax is the activity (professional services) and not the increase in assets.
So it turns out that I would have to pay VAT plus ISR in my monthly provisional declaration.
However, since I am not the final consumer of the professional activity taxed by VAT (because it was I who provided the professional services and my client who consumed them) I can transfer the tax.
The transferred VAT is the one that we charge to our clients.
VAT is a consumer tax, that is, the one who causes and pays it is the final customer of the goods and services taxed under said tax.
Its main characteristic is that it does not fall directly on the taxpayer’s income, but instead affects the cost of a service or product, so that the taxpayer who generates the consumer good does not pay for it, but transfers it until it reaches the final consumer.
In other words, the transferred VAT is charged by independent natural persons and legal entities when they invoice for the goods or services they provide to customers.
Subsequently, this VAT collected will be paid to the Ministry of Finance and Public Credit, this is done this way because in practice it is difficult for the tax authorities to collect this tax from each of the taxpayers, which is why a scheme was established in the which products, goods and services are recorded. For this reason, the amount of VAT is added to the base or real price so that this is paid when making the corresponding tax declarations.
We are obliged to pay the value added tax for natural and legal persons that in national territory carry out activities of alienation, provision of independent services, temporary use or enjoyment of goods and the importation of goods or services.
For this reason, it is important that every natural or legal person, when quoting their fees for the provision of a service or product, clarify to the client that VAT is included or not within said price, because if not, the service provider will end up paying it. of his own income even when it would not be his place to do so.
As always, a pleasure to greet you, hoping that these few letters have been to your liking and, above all, useful. Until next time!
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