Mexico: Limitation on deductibility of net interest held valid (court decision)
A court decision concerning imitation on deductibility of net interest
A court decision concerning imitation on deductibility of net interest
The First Chamber of the Supreme Court (Suprema Corte de Justicia de la Nación) held (381/2021) that the limitation on the deductibility of net interest in excess of 30% of tax profit does not violate the principles of equity, proportionality, tax legality and legal certainty.
Part of the court ’s reasoning in validating the limitation on the deductibility of net interest was that the provision is consistent with the OECD’s base erosion and profit shifting (BEPS) project.
Read a December 2022 report (Spanish) 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.