Consumption taxes

Nature of the tax

VAT (Value Added Tax) called "Impuesto al Valor Agregado - IVA"

Tax rate

16% -  Value Added Tax Laws

Reduced tax rate

11% for the activities of enterprises located in a frontier zone. Exports are subject to a rate of 0%, as well as basic foodstuffs, agricultural services related to the production of them and medicines.

Other consumption taxes

Special Production and Services Tax Law (applied to alcoholic beverages, elaborated tobacco, gasoline and diesel). Laws for New Automobiles.

Corporate taxes

Tax rate

Tax rate for foreign companies

All legal entities that according to the Federal Tax Code  are considered Mexican residents are taxed for worldwide income received, depending of their activity or social object, in any of the following regimes:

- Legal entities of general regimen
- Legal entities non-profit
- Legal entities of simplified regimen

Legal entities that are not residents, must pay taxes in Mexico when they earn an income from a source of wealth located in Mexican territory (income tax and flat rate corporate tax).

Capital gains taxation

A flat tax (IETU) has been set up. It represents the minimum corporate tax on capital gains. The rate is 17%.

Main allowable deductions and tax credit

The expenses for establishing a business can be deductible if they are backed up properly, some of them can be: real estate acquisition expenses, VAT, contributions to third parties, etc.  For more information, consult the site of Mexican Federal Tax Administration

Other corporate taxes

For information on the other taxes levied on companies in Mexico, access Mexconnect.

Individual taxes

Tax rate

Allowable deductions and tax credit

There are several types of deductions attributed to taxpayers in Mexico. You can find out the nature of all the deductions by contacting Mexican Federal Tax Administration.

Special expatriate tax regime

If a foreigner resides in Mexico for business purposes for more than 183 days per year, he can obtain a special tax rate, however there are no special deductions for expatriates.

Double taxation treaties

Countries with whom a double taxation treaty have been signed

See the list of financial agreements signed between Mexico and other countries

Withholding taxes

Dividends: 0%, Interest: 4,9% / 30% / 40%, Royalties: 25% / 30%

Bilateral agreement

Mexico and Tunisia are bound by a double taxation treaty: no

Sources of fiscal information

Tax Authorities

Mexican Federal Tax Administration

Other domestic resources

Ministry of Finances and Public Credit