New Tax Law Aims to Promote TradeBy Alessa Flores | Thu, 11/26/2020 - 12:30
The Ministry of Economy (SE) reported that the new law of General Taxes on Imports and Exports (LIGIE), which will be enforced on Dec. 28, aims to promote foreign trade, not to add or change taxes currently applied in the country. "We believe that updating the LIGIE and the modifications to the various instruments that emerge from it will strengthen the integral regulation of the normative system of our foreign trade, which will have a positive impact by providing certainty to the operations of companies," said Graciela Márquez, Minister of Economy, to Milenio.
The new law will serve to implement a sixth amendment to the harmonized system, compacting the Correlation Table between the Rate of the General Import and Export Tax Law (TIGIE) (reduces more than 4,000 tariffs) and implementing a fifth pair of digits for commercial identification purposes. Therefore, this new law will not modify tariffs and does not impact non-tariff regulations nor Chapter 98 and prohibited items, explained SE.
Mexico's trade balance has gone through positive changes, even in the context of COVID-19. According to recent figures from INEGI, foreign trade had a surplus of US$5.8 billion by July 2020 compared to Mexico's deficit of US$1.2 billion for the same period. In the first seven months of this year, trade balance had a surplus of US$8.4 billion. In September 2020, exports amounted to US$35.6 billion, consisting of US$34.2 billion of non-oil exports and US$1.4 billion of oil exports. Meanwhile, the value of merchandise imports totaled US$29.8 billion, which implied an annual variation of negative 26.1 percent. This figure reflected decreases of 24.1 percent in non-oil imports and 44.4 percent in oil imports. International trade represents 79 percent of Mexico's GDP, so "it is the obligation of authorities to maintain the regulations that govern it updated, modern and efficient," explained Márquez to Milenio. "Mexico's foreign trade is one of the main engines of the economy," she said.
In an exclusive interview for MBN, Lior Yafe, Economic Counselor at the Embassy of Israel in Mexico, highlighted that Mexico is undoubtedly a significant target for Israeli companies. “This is true not only because Mexico is a large and mature market in terms of its size and potential that has not yet reached its maximum, but also because of its proximity to the US and being part of the regional supply chain.” Yafe said that once the pandemic is over, Israel will seek to strengthen its relationship with Mexico. “In addition, when COVID-19 ends and when it is possible to fly to and from Israel on a regular basis, my team and I will help to create business road shows and delegations to Israel and Mexico for Israeli and Mexican companies on a regular basis,” said Yafe.