This has implications for public finances; on the one hand, you receive less money from the sale and export of oil, but also, due to the drop in fuel prices, you can collect from the part of the Special Tax on Production and Services (IEPS) that It is charged on gasoline and diesel, but not enough to compensate for the lack of income due to a lower price of the mixture, explained Arturo Carranza, director of Energy Projects at Akza Advisors.
Tax reform necessary
Given the decline in these incomes, the fiscal issue is key, essentially a reform or changes aimed at increasing tax collection.
“There are companies that pay taxes, legal exemptions, that should be perfected, covering more evenly, we must move towards eliminating exemptions, because we all must pay taxes, it has always been the tax issue; of little public income, of low public income, of a poor exercise of public spending, all this must be improved, but there is a long way to go,” says Rodolfo Navarrete, chief economist at Vector Casa de Bolsa.
According to the Organization for Economic Cooperation and Development (OECD), “there is scope to raise more revenue from property taxes, environmental taxes, and make the tax system more effective and progressive by reducing taxes.” tax deductions that benefit the richest,” says the OECD in its Economic Study of Mexico 2024.
The alliance for tax justice, a conglomerate of public finance research laboratories -CIEP, Fundar, México Evalúa and Oxfam-, proposes a reform that charges higher taxes to higher-income Mexicans, through changes such as increasing tax rates. ISR (more progressive), reduce tax benefits and recover the tax on millionaire inheritances.
Review spending
There are also those who consider that the new Mexican government will have to adapt to new provisions at a global level, such as the global minimum tax on multinational companies of 15%, an OECD initiative that is advancing in its member countries, considered Juan Manuel Franco, specialist and advisor to national and international companies on tax matters.
Specialists consulted by Expansion They consider that, in the face of pressures and mandatory expenses, it is also necessary to make the Federation’s Expenditure Budget more efficient.
In this sense, the virtual president-elect proposed in her campaign to continue with the austerity policy; However, this is not the same as making spending more efficient, highlighted Christopher Cernichiaro, postdoctoral researcher at the Metropolitan Autonomous University (UAM).
He explained that with the current government austerity, cuts have been made on the fly to free up money, instead of exhaustive reviews to cut onerous expenses to dedicate them to developing infrastructure and providing public services to citizens.
And the fiscal deficit?
With these actions, in addition to needing less money for works such as the Mayan Train and refineries, it is possible to reduce the fiscal deficit, that is, the difference between what the public sector spends and earns.
For the end of the year, a public deficit of 5.0% of GDP and 2.5% for 2024 and 2025, respectively, is anticipated, say the General Precriteria for Economic Policy.
“We estimate that Sheinbaum will maintain the current president’s austerity rhetoric and that presidential projects will continue to dictate spending objectives. However, the degree of commitment to fiscal austerity remains to be seen, especially in relation to a significant reduction in the fiscal deficit that this year will exceed 5% of gross domestic product (GDP) and, more importantly, to demonstrate the willingness to adopt measures that maintain the deficit at levels recorded in previous years; that is, from 2% to 3% of GDP,” Moody’s Ratings considered in an analysis.
When is the 2025 economic package delivered?
According to information from the Chamber of Deputies, this year it will be until November 15, six weeks after the new federal government has taken office, when the package proposal will be delivered.
The Congress of the Union will have until the end of the regular period of sessions to approve it (December 15). Although it could also agree to an extraordinary period, in order to have more time to debate the 2025 Economic Package (December 31).
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