For Mexican micro, small and medium-sized enterprises (MSMEs), e-commerce represents a route to access new markets without the need for a traditional commercial infrastructure, but for some businesses, this route has begun to be a bottleneck in cash flow starting in 2026, with the increase in tax withholdings applicable to sales made through digital platforms.
Since January of this year, micro, small, and medium-sized enterprises (MSMEs) that sell goods or provide services through digital platforms have faced a 2.5% Income Tax (ISR) withholding, while the Value Added Tax (VAT) withheld is equivalent to 8% . Together, these withholdings can represent an immediate outflow of resources from their operations.
This scheme is particularly relevant in a segment where margins and capital turnover are critical. Withholding tax is applied to operating revenues, not profits, so the financial impact can be felt before the seller has recovered their costs of merchandise, storage, distribution, or marketing.
In this regard, business organizations such as the Mexican Online Sales Association (AMVO) , the Mexican Association of Entrepreneurs (ASEM) , the Mexican Business Council for Foreign Trade, Investment and Technology (Comce) , the International Chamber of Commerce (ICC) , and the American Chamber of Commerce of Mexico (AmCham) , among others, proposed reducing the rates to 2% VAT and 1% ISR, arguing that a lower withholding would allow them to maintain the objective of formalization and collection without compromising the liquidity of small businesses.
This proposal comes in a market with ample room for growth. According to the 2024 Economic Census by the National Institute of Statistics and Geography (Inegi) , only 5.5% of the country’s economic units made sales online in 2023. Among micro-enterprises, the proportion was only 4.4%, compared to 27.9% for small businesses and 33.4% for medium-sized businesses.
This data illustrates the scale of the challenge: the digitalization of businesses in SMEs is still far from widespread. And while online platforms offer a way to bring businesses into e-commerce, higher withholding taxes could discourage this adoption.
The Mexican National Institute of Statistics and Geography (INEGI) itself indicated that among businesses already selling online, 38.2% use third-party websites , while 24.3% use social media. In commerce, third-party platforms and sites are part of the digital infrastructure that allows businesses to reach their customers.
It’s worth noting that the 2026 Economic Package proposed standardizing the withholding of income tax for individuals selling goods through online platforms with the maximum rate of 2.5% under the Simplified Trust Regime (Resico). The goal is to expand control and tax collection in the digital economy .
The effects of the measure are already being felt. According to a statement, since the first month the current scheme has been in effect, it has been documented that between 15% and 30% of sellers active in 2025 stopped listing in the first quarter of 2026. A contraction of between 20% and 52% in the revenue of sellers who remain active was also recorded, compared to the previous year.
The organizations, which also include the Latin American Internet Association (ALAI) , the National Chamber of the Electronics, Telecommunications and Information Technology Industry in Mexico (Canieti) , Alianza In México, and the National Chamber of the Restaurant and Seasoned Food Industry (Canirac) , indicated that 77% of vendors reported a negative impact on their cash flow and 68% reported a reduced capacity for reinvestment in inventory, personnel, or growth. Furthermore, only 3% of vendors have managed to recover their VAT refunds, with an average processing time of four to six months.
The cost has also been passed on to the end consumer , with increases in publication prices of between 3.5% and 17% in a quarter, well above the benchmark inflation rate (1.56%).
In that context, the agencies called for a technical adjustment to the current scheme —particularly in the VAT withholding rate and mechanism—which would allow for sustained short-term revenue collection while preserving the trajectory of formal incorporation of SMEs.
According to industry data, the tax withholding applicable to sales through digital platforms puts at least 300,000 micro, small, and medium-sized enterprises (MSMEs) at risk of extinction.
The discussion leading up to the 2027 Economic Package will focus on whether the current scheme manages to broaden the tax base without hindering the incorporation of new sellers into e-commerce.
Comment and follow us on LinkedIn: @GrupoT21
