Mexico: Tax reform proposals in economic package for 2022

An economic package includes proposals relating to federal budget for 2022

An economic package includes proposals relating to federal budget for 2022

Mexico’s president on 8 September 2021 presented to the Mexican Congress an economic package for the year 2022.

The package includes proposals relating to federal budget for 2022 as well as proposed changes to the federal income tax law and value added tax (VAT) and excise tax (duty) legislation. The economic package does not propose any new taxes or increases to the existing taxes, but it is possible that changes could be made during the legislation process.

With regard to taxes, the legislative proposals include certain tax incentives (specifically with regard to the excise tax paid on diesel fuel for certain activities) and rules for income tax withholding by financial institutions that are part of the Mexican financial system (similar to an estimated income tax payment on individual depositors).

Other proposals concern the tax treatment of foreign exchange rate differences, a tax credit for income tax paid abroad, back-to-back loans for financing operations, monthly estimated income tax payments, gain realized on the alienation of property, and certain business reorganizations.

Another measures proposes changes to the thin capitalization rule, and there are proposed changes to the transfer pricing rules and proposed measures relating to Mexico’s international tax regime (including tax treaty benefits and the tax treatment of income related to immovable property and securities).

Read a September 2021 report prepared by the KPMG member firm in Mexico


The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 3712, 1801 K Street NW, Washington, DC 20006.