Mexico’s Ministry of Finance and Public Credit (SHCP) reported that tax revenue and public sector revenue increased during Jan. 2022 thanks to the country’s adequate management of its public finances, which remain in line with the 2022 economic package.
“In the first month of the year, public finances are in line with the 2022 economic program. Public sector revenues increased 3.1 percent in real terms compared to Jan. 2021. This was due to the recovery of oil revenues and the solid evolution of tax collection. In addition, it highlights that ISR income increased 10.6 percent in annual terms,” reads SHCP’s press release.
Mexico’s economic package for 2022 focuses on strengthening support for social welfare and supporting regional projects that trigger investment, social development and wellbeing. It also favors the stability and soundness of public finances, as reported by MBN. The package also includes a new system for taxpayers: the Trust Regime, which was implemented to simplify tax payments, especially among small taxpayers, as reported by MBN.
The SHCP also announced that public revenues showed a real annual increase of 12.2 percent. The money will be directed towards programmable spending to strengthen economic activity and social development. The public sector also increased its physical investment by 3 percent in real terms, in comparison to the same month in 2021.
Mexico’s GDP to debt ratio remains at 46.4 percent, a sustainable level according to the SHCP. The country’s state oil company, PEMEX, also reduced its debt by US$3.2 billion in the first month of the year after a successful refinancing operation alongside SHCP.
Mexican finances reached MX$543 billion (US$26.3 billion) in Jan. 2022, after the collection of public sector budget revenues. However, the amount was lower than the forecasted figure by MX$49 billion (US$2.37 billion) but 3.1 percent higher per year in real terms in comparison to Jan. 2021.
In Jan. 2022, SHCP announced a refinancing program to consolidate the country’s Annual Financing Plan for the year, with two bonds that will help reduce the country’s financial pressure by 70 percent by 2023, as reported by MBN.