Tax laws Mexico
Mexico's tax system is multifaceted, encompassing various taxes at the federal, state, and municipal levels. Key components include:
1. Income Tax:
Individuals: Mexico imposes a progressive income tax on individuals, with rates ranging from 1.92% to 35%, depending on income levels.
Corporations: The corporate income tax rate is set at 30%.
2. Value Added Tax (VAT):
Standard Rate: The general VAT rate is 16%, applicable to most goods and services.
Border Regions: Certain border areas benefit from a reduced VAT rate of 8% to stimulate economic activity.
3. Social Security Contributions:
- Employers and employees contribute to social security, covering pensions, healthcare, and other benefits.
4. Excise Taxes:
- Specific goods, such as alcohol, tobacco, and fuel, are subject to excise taxes.
5. Electronic Invoicing (CFDI):
- Since 2004, Mexico has mandated the use of electronic invoicing (CFDI) for all business transactions, aiming to reduce tax evasion and streamline tax collection.
6. Tax Administration:
- The Tax Administration Service (SAT) oversees tax collection and enforcement, ensuring compliance with tax laws.
7. Recent Developments:
New Tariffs: In January 2024, Mexico introduced new tariffs to strengthen surveillance on goods from countries without trade treaties, notably affecting imports from Asia.
Cruise Ship Passenger Fees: The Senate approved a $42 fee per cruise ship passenger for port calls, aiming to generate revenue for the military, though it has raised concerns within the tourism industry.
Note: Tax laws and regulations are subject to change. For the most current information, consult official Mexican tax authorities or seek professional tax advice.
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