Mexico.- On this day, the Ministry of Finance and Public Credit (SHCP) stated that the increase that has been recorded in Mexico’s oil revenues, derived from the global context, will be transferred directly to the national economy in the form of subsidies for gasoline and other fuels.
The foregoing, he pointed out, the federal agency headed by Rogelio Ramírez de la O, with the aim of not cause an inflationary impact in the different products that are marketed within the national territory, for this reason he ruled out that there will be cuts in public spending.
At a press conference, the undersecretary of Finance and Public Credit, Gabriel Yoriomaintained that the stimuli applied by the federal government through the SHCP to gasoline and diesel will have a “neutral” impact on the country’s public finances.
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Due to the foregoing, the public servant denied that the subsidies that the federal administration has been applying to fuels will have negative effects, such as budget or public spending cuts.
“The stimuli will have a neutral impact on public finances, it will not have effects on budget cuts or spending, because practically all the additional positive flow of oil revenue that is being captured is being transferred to the economy,” he explained.
In this sense, Yorio announced that the subsidies, to which the complementary stimuli are added to the energy ones, whose objective is to prevent the so-called “gasolinazos”, will be maintained throughout this 2022 in order to face the global increase of the price of oil.
According to the considerations of the Undersecretary of Finance, the strategy implemented by the government of President Andres Manuel Lopez Obrador prevented inflation accumulated from January to April this year from increasing by 2%.
BBVA warns about gasoline subsidies in Mexico
Last March of this year, the financial group BBVA warned that the subsidies allocated by the Mexican federal government so that the gasoline price does not increase for the final consumer could cause the collection of the Special Tax on Production and Service (IEPS) will collapse this 2022.
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“If this resistance from the federal government and international gasoline prices continue at levels similar to the current ones, the IEPS collection for gasoline and diesel could even be negative in the following months,” he said.
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