Price including VAT in your online store (and how much of that is yours)
In Mexico, the price you post in your online store has to be the total, with VAT included. To pull out the VAT, divide by 1.16 and subtract. Out of $1,160, $160 is VAT and $1,000 is yours.
Abigail sells hand-stitched piteado wallets and belts made by three artisans in Colotlán, Jalisco. When she put together her online catalog, she copied the way her leather supplier quotes her: “Piteado wallet, $1,000 + VAT.” That week she got eleven WhatsApp messages with the same question, “so how much is it?”, and three of those conversations stalled at “let me think about it” when she answered $1,160. The price wasn’t the problem. How it was written was: in a store for people, the price including VAT is the only one worth posting.
Does your online store’s price need to include VAT?
Yes. If you’re selling to people, the price you post has to be the total they’re going to pay, taxes already in. That’s what Mexico’s Federal Consumer Protection Law requires — the total amount payable, shown up front — and it’s how people shop in Mexico: nobody does the 16% math in the supermarket aisle.
”+ VAT” has its place: business-to-business quotes, like the one Abigail’s leather supplier gives her. In your store, the buyer is a person with a phone in hand, and every bit of math you ask them to do is one more “let me think about it.”
How do you pull the VAT out of a price that already includes it?
Divide the price by 1.16: what comes out is yours, and the difference is the VAT. A $1,160 wallet is $1,000 yours and $160 in VAT.
The most common mistake is taking 16% straight off the price. 16% of $1,160 is $185.60, and that isn’t the VAT on anything. The 16% is calculated on your share, not on the total, so inside a VAT-included price the tax ends up being a smaller slice: around 13.8% of what you charge.
| Price posted | Yours (÷ 1.16) | VAT |
|---|---|---|
| $350 | $301.72 | $48.28 |
| $1,160 | $1,000.00 | $160.00 |
| $2,400 | $2,068.97 | $331.03 |
The general rate is 16%. If your business is in the border region and your accountant told you the 8% incentive applies to you, divide by 1.08 instead. And some products fall under a 0% rate. Which one applies to you is decided by your tax regime — ask your accountant, not your website.
How much of your price is actually yours?
What’s left after dividing by 1.16, minus what it costs you to make or buy what you sell. That’s your margin, and if you’ve never pulled it out with VAT removed, it’s smaller than the one in your head.
That’s what happened to Abigail with the belts. She had them priced at a round $2,400 and paid $1,500 for each one between leather, pita thread, and the artisan’s labor. In her head she was making $900 per belt. With VAT taken out, she was left with $568.97 — almost 37% less than she thought, on her most expensive product. She raised the price to $2,600: now she keeps $741.38 per belt, and the price is still a single number, no asterisks.
If I turn on tax in my site, does the price go up for my customer?
In Proyecta, no. The price you type into your dashboard is what your customer pays, whether they check out with a card, Mercado Pago, PayPal, or a bank transfer, and tax is never added on top, not on the product and not on shipping.
Watch out for this before you publish, because it nearly tripped Abigail up: when she moved her catalog to her site, she entered the wallets at $1,000, the way they appeared on her old price list. Her site would have charged exactly $1,000, and of that, $137.93 is VAT. If you wrote your prices assuming VAT got added afterward, fix them first: your price including VAT is the one that goes in the dashboard.
If you take card payments through Stripe, you’ll find a “Sales tax” section under your store’s Settings. That’s where you register where you have tax obligations, and from that point on, Stripe works out what part of each card payment is tax. It doesn’t change the total — it just breaks it down.
On each order’s detail page you’ll see a “VAT included” line with its amount, and your customer sees “Taxes included” under “My orders.” If you take payments through the other channels, the total is the same and you work out the breakdown yourself with ÷ 1.16.
What does “no tax is being charged” mean if I haven’t registered?
It means your site isn’t breaking out the VAT, not that you don’t owe it. The section says so plainly: “Until you add a registration, no tax is being charged.”
Since your prices already have VAT built in, your customer pays the same whether you’re registered or not. What changes is your own accounting. If you’re registered with the SAT under a regime that’s subject to VAT, that 13.8% of every sale goes into your tax return even though no receipt shows it (minus the VAT you paid your own suppliers, which is a question for your accountant). Reading that line as “my sales don’t carry VAT” is the fastest way to spend money that isn’t yours.
And if my customer asks me for an invoice?
You issue it yourself, separately, same as today. Proyecta doesn’t issue CFDI invoices, and even the receipt settings warn you: “This receipt is not an invoice (CFDI).”
What your site does give you are the numbers to build one without guessing: each order’s total and, if you’ve set up registration in Stripe, how much of that was VAT. With that, you or your accountant can issue it through the SAT portal or whatever invoicing service you already use.
What should I do with my prices today?
Take your best-selling product and run one calculation: price divided by 1.16, minus what it costs you. That’s what you earn per piece. If the number doesn’t sit right with you, the answer is to raise the price, not to tack on ”+ VAT.”
And if you don’t have an online store yet, just describe it to Proyecta as it is: “a store for my piteado wallets and belts from Colotlán, with a photo of each piece, its price, and card payment.”
Once it’s published, go into your dashboard and check that every price is the total you want to charge, because that’s what your customer is going to pay — no math halfway through checkout. Get started at proyecta.dev.