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Mexico: Resolution on offsetting balances, tax incentives in northern border region

Mexico: Offsetting balances, tax incentives

A tax resolution published on 30 January 2019 in the official gazette reflects various certain changes under Mexico’s tax law.


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The Sixth Resolution of Modifications to the Miscellaneous Fiscal Resolution for 2018 (Sexta Resolución de Modificaciones a la Resolución Miscelánea Fiscal para 2018) had been available on the website of the tax administration (Servicio de Administración Tributaria—SAT) since 7 January 2019. 

Among the measures in the modifications are the following items:

  • The ability to offset or apply balances of taxpayer-favorable amounts against amounts of federal tax owed, for balances as of 31 December 2018. A notice invoking this benefit must be submitted electronically via the SAT portal, and application of this benefit is not available against tax withheld by third parties.
  • Concerning the economic stimulus program for the “northern border region” (región fronteriza norte), a process is established and the rules indicate that it must be clearly stated that all requirements for the incentive have been satisfied. If a taxpayer fails to comply with any of the requirements, the tax authorities can invalidate the incentives for that taxpayer. There are also rules for “real time” verification, and a clarification that at least 90% of the total income must be obtained in the northern border region (income corresponding to the business activities conducted the northern border region) without consideration of intangible goods or digital commerce. Guidelines for obtaining the benefit of the reduced rate of value added tax (VAT) are provided with respect to the northern border region program.


Read a February 2019 report (Spanish) prepared by the KPMG member firm in Mexico

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