With the aim of promoting the Mexico’s economic growththe Business Coordinating Council (CCE), requested the president of the country, Andres Manuel Lopez Obrador (AMLO)that a temporary reduction of the corporate rate of the Income Tax (ISR)as well as eliminate the collection of this tariff to those who perceive less than 10 thousand pesos monthly.
through the document ‘Considerations for a tax reform promoting growth’states “In order for our country to be more competitive, it is suggested to temporarily lower the income tax rate to 28%,” says the text, as a tax reform proposal from the agency that was presented last month to the president of Mexico.
According to information from Forbes Mexico, the draft has 18 proposals for tax reform, and states that for the ISR reduction to be financially viable, it should be applicable to those who only reinvest profits carrying a Reinvested Tax Account (Cuinfre).
“At the CCE we are convinced that a pending task is to carry out a tax reform that will make collection more efficient, simplify compliance with tax provisions, provide legal certainty to taxpayers, favor the control of public spending and encourage investment in the country”, states the document.
It also adds that the business organizations that make up the CCE are working in order to share with the tax authorities a tax reform proposal that contributes to the above purposes.
“The rate differential (2%) would be paid when dividends are declared. This measure will encourage the reinvestment of profits in companies”, comments the CCE, chaired by Francisco Cervantes Diaz.
It is important to point out that the tax rate on the rent of 30 percent of Mexicowhich is above the average of the countries of thea Organization for Economic Cooperation and Development (OECD)who charges a 23 percent tax, pointed out that the business organization.
The ECC also asks the Mexican authorities to eliminate the income tax rate for individuals with income less than 10 thousand pesos per monthsince it could “contribute to the consumption of goods, and consequently, indirectly collect taxes such as Value Added Tax (VAT)”.
We recommend you read:
In turn, the secretary of Treasury and Public CreditRogelio Ramírez de la O, ruled out promoting a tax reform for the moment, since the president López Obrador promised not to make one.
“Ideally, the best thing is to lower taxes as much as possible, however, this administration has already cut VAT on the northern border by half to equalize it with the sales tax on the southern border of the United States; and the income tax was also cut in half,” said Ramírez de la O.
#propose #eliminate #ISR #Mexican #employees #earn