A tax reform package, presented by Mexico’s federal government in September 2013, is proceeding through the legislative process.
A congressional committee (the Finance and Public Credit Committee of the Chamber of Deputies) considered the proposed legislation and in turn proposed its own changes. The Chamber of Deputies passed its revised version of the bill late 17 October 2013.
The proposed changes include:
- Measures to limit certain deductions to 10% of the taxpayer’s total gross income or twice the annual minimum wage;
- Measures concerning individual tax matters including a 32% tax rate on income over MXN 500,000 and a 10% capital gains tax rate on the sale of listed shares;
- Measures concerning the maquiladora tax regime;
- An additional 10% corporate income tax on dividends and profit distributions; and
- Value added tax (VAT) measures including the elimination of the VAT exemptions on educational services, the alienation or leasing of a residential dwelling and mortgage interest.
New taxes would apply to coal combustibles, pesticides and sugary drinks.
