Mexican tax reform may have substantial impact on taxpayers
An overview of the 2021 Mexican tax reform act
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In December 2020, the Mexican Congress approved the tax reform act for 2021 (2021 Act). Most of the changes contained in the 2021 Act apply to tax years beginning on or after Jan. 1, 2021. And while the changes are not extensive, they do contain new rules that have a substantial effect on Mexican taxpayers, as well as foreign residents with a presence in Mexico.
In addition to the 2021 Act, there are a few other developments in Mexican taxation, including:
- Proposed rules to combat abusive payroll outsourcing arrangements
- An extension of the Northern Border Tax Stimulus that was enacted in 2019
- A new Southern Border Tax Stimulus
U.S. companies with operations in Mexico should review the changes outlined in our review of the 2021 Act to find out what should be done proactively to ensure the organization remains in compliance with Mexican tax law, and more importantly, to learn about new tax benefits included in the 2021 Act.
If you have specific questions about how any of these rules may affect your business, please contact us today. We are here to help.