SAT Denies Supervising Cash TransactionsBy Emilio Aristegui | Fri, 08/19/2022 - 14:20
Mexico’s Tax Administration Service (SAT) clarified its tasks as tax collector, assuring the Mexican population that it does not supervise cash transactions. Meanwhile, several Mexican fintechs continue to develop solutions for financial inclusion solutions
The institution reported that “it is false that the SAT charges taxes for cash deposits made in banking institutions. It is pertinent to clarify that all those deposits that are made for expenses from parents to children or vice versa, payments for catalog sales (cosmetics, kitchen and household utensils or essential oils, among others), batches or personal loans are not monitored. Nor does it charge any type of tax,” explained SAT via a press release.
SAT clarified for the general population that taxes and information regarding the contribution regime are well-known by the entity, revising that only financial institution are capable of presenting monthly information on taxpayers that are either under an audit, oversight or review process by SAT.
The tax collector also specified that it only requests information when it detects inconsistencies between expenses and income on deposits from financial institutions, searching to avoid tax fraud.
“The SAT carries out approximately 10,000 audits a year; the information declared by the taxpayers regarding the bank deposits received is reviewed and is compared with the data provided by the financial institutions on a monthly basis for a more exact control. This makes it possible to streamline and make audits more efficient and therefore more expeditiously combat tax evasion,” reads SAT’s press release.
In 1Q22, tax collection efficacy saw one of its best quarters, collecting MX$46.33 billion (US$2.32 billion), a 63.8 percent increase compared with 1Q21, as reported by MBN.“Although voluntary compliance is preferred over inspections, additional efforts have not been relaxed. Between Jan. and March 2022, 270 Large Taxpayers were audited,” said SAT. Additional tax collection efforts during 1Q22 brought the treasury MX$139.94 billion (US$7 billion), which is also the best figure for a first quarter in history.
Cash payments are prevalent in Mexico, so companies of all sizes are launching tools to capitalize on this market. Mexican fintech Arcus recently introduced its newest cash withdrawal solution for its Red Arcus Pay network, which allows clients to make or receive payments from companies in cash, as reported by MBN.