On 28th December, 2018, the official Mexican gazette – the Federation Income Law (FIL) – was published for 2019, enforcing the following most relevant legal amendments.
Suspension of universal compensation of taxesAnti-laundering notices for outsourcingTax incentives for the northern border regionvalidity: January 2019 to December 2022reduction of VAT in the north border region from 16% to 8%reduction of corporate income tax from 30% to 20%Tax incentives for income tax and VAT will not be considered as taxable income for the purposes of income tax.areas benefitting and the municipalities of the states of:Baja California: Ensenada, Playas de Rosarito, Tijuana, Tecate and MexicaliSonora: San Luis Río Colorado, Puerto Peñasco, General Plutarco Elías Calles, Caborca, Altar, Sáric, Nogales, Santa Cruz, Cananea, Naco and Agua PrietaChihuahua: Janos, Ascensión, Juárez, Praxedis G. Guerrero, Guadalupe, Coyame del Sotol, Ojinaga and Manuel BenavidesCoahuila de Zaragoza: Ocampo, Acuña, Zaragoza, Jiménez, Piedras Negras, Nava, Guerrero and HidalgoNuevo León: AnáhuacTamaulipas: Guerrero, Mier, Miguel Alemán, Camargo, Gustavo Diaz Ordaz, Nuevo Laredo, Reynosa, Rio Bravo, Valle Hermoso and MatamorosSubjectslegal entities that pay into the general regimelegal entities with the option of accumulation based on effective collectionindividuals who pay into the general regime of individuals with business and professional activitiesThe third amendment provides exciting opportunity to keep current investments and to bring new investment into this area of the country. We foresee that the current business landscape in the north will make it an attractive and competitive region for national and international industries, given these incentives.

At ECOVIS Quibrera Saldaña, Mexico, we provide consulting services in the establishment, taxation and auditing of national and foreign businesses.

Author:

Ricardo Quibrera Saldaña, Partner/Chartered Accountant, ECOVIS Quibrera Saldaña, Santa Fe, Mexico
ricardo.quibrera@ecovis.mx