Uruguay Tax Agency Posts Consultation Clarifying VAT Treatment of Digital Platform Without PE

The Uruguayan General Directorate of Taxation Oct. 1 posted online Consultation No. 6679, clarifying income tax on nonresident individuals (IRNR) and VAT for a subscription service provided by a Swiss entity without a permanent establishment (PE) in Uruguay. The taxpayer, sold appliances and an optional paid digital platform subscription for recipes, planning tools, and tutorials. The taxpayer sought clarification on whether the subscription income was subject to IRNR and VAT. The clarification states that: 1) under the 2010 Uruguay-Switzerland DTA, the subscription income qualified as business profits taxable in Switzerland, due to the seller’s lack of a PE in Uruguay; ...