Taxes Affecting Imports
A Guide to International Trade in Mexico
Taxes Affecting Imports in Mexico
In addition to import duties, if applicable, imported goods may be subject to various internal charges or taxes, such as a customs processing fee (derecho de trámite aduanero or DTA), value-added tax (VAT), the special tax on production and services (IEPS), or the tax on new motor vehicles (ISAN).
Customs Processing Fee (DTA)
The Customs Processing Fee (DTA) applies to imports due to the use of customs services and facilities. Generally, the rate of the DTA is 0.008% of the declared value of the goods. Under Free Trade Agreements, such as USMCA, EUMXFTA, among others, Mexico has agreed to apply for specific DTA rates or exemptions.
Would you like to know if your goods are subject to DTA? Contact us.
A portion of the DTA is used for the modernization of customs facilities and infrastructure.
Value Added Tax (VAT)
Imports are normally subject to a 16% VAT, particularly definitive imports including temporal imports, while exports are not subject to VAT.
Although temporal imports are also subject to VAT, in theory, IMMEX companies may access a certification that allows them to avoid paying VAT either with a tax credit or a bond. In other words, a “certified” IMMEX company would have a “tax credit” equivalent to the VAT liability that should be paid when the good is temporally imported.
Other customs regimes, such as the introduction of goods into an in-bond facility (depósito fiscal), are not considered as an import and, thus, VAT payment is not required.
Needless to say, the VAT law includes some 0% VAT rates for certain products.
Would you like to know if your goods are subject to VAT in Mexico? Contact us
The Special Tax on Production and Services (IEPS)
Like VAT, the special tax on production and services (IEPS) is an indirect tax applicable to the importation of specific products and services, including goods subject to the temporary importation regime. IEPS tax varies per product or service and is expressed in rates or ad valorem, specific or a compound, that varies. In 2020, rates were adjusted to reflect inflation.
What are the goods subject to IEPS?
- Alcoholic beverages and beer
- Alcohol, denatured alcohol and non-crystallized honey
- Cigarettes
- Cigars and other worked tobacco
- Fuels
- Energy drinks and syrups and concentrates for the preparation thereof
- Flavored drinks and syrups and concentrates for the preparation thereof, containing added sugar
- Pesticides
- High-calorie non-staple foods (≥ 275 kcal/100 grams)
- Others
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The Tax on New Motor Vehicles
New vehicles are subject to the ISAN, which is a compound tax with an ad valorem component and a specific component. For vehicles bought in the country, the tax is calculated on the sales price of the vehicle to the final consumer. In the case of imports, the tax is calculated on the basis of the customs value plus import duty and other import-related duties, excluding VAT (art. 2 ISAN Law). Mexico, in fact, has a tax incentive that promotes the purchase of automobiles under a certain value
Electric motor vehicles are exempt from the ISAN in order to promote “eco” friendly means of transportation (art. 8 ISAN Law).
More Information
Why Foreign Investors should use a US company for Mexican Operations? Josh Maxwell provides a crossborder overview about doing business in Mexico.
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Non-Tariff Barriers
Automatic and Non-Automatic Import Licences Applicable in Mexico
Customs
Everything you need to know to import or export in Mexico.
How to do business in Mexico?
The Mexican Legal Guide
How to create a company in Mexico?
Under this section, Doing Business Mexico explains the 12 steps to create a company in Mexico, including the basic legal features of the two most relevant types of companies as well as other possible business structures.
Visit our guide: How to create a company in Mexico?
Do Foreign Investment Restrictions Apply in Mexico?
As a general rule, all sectors of the economy are open to foreign investors unless otherwise provided in Mexico’s Foreign Investment Law. Although through the years sectors have been liberalized, Mexico has still foreign investment restrictions in place that are applicable to specific activities as well as restrictions on land ownership.
Visit our guide: Foreign Investment in Mexico.
International Trade in Mexico
Being a WTO member and having 13 Free Trade Agreements, Mexico is a country that is open to international trade. In this guide, topics such as tariffs, preferential tariffs, import restrictions, customs procedures, Free Trade Agreements like USMCA, among other matters, are reviewed.
Visit our guide: International Trade in Mexico.
The IMMEX Program and the Mexican Manufacturing Industry
The export-oriented manufacturing industry, also known as the maquiladora industry, represents one of the most important pillars of the Mexican economy. The IMMEX program is, to a great extent, used by companies within the manufacturing industry. In this guide, Doing Business in Mexico provides a general overview on the IMMEX program.
Visit our Guide: The IMMEX Program.
Taxation in Mexico
What are Mexico’s main taxes? What is the corporate income tax rate or Mexico’s VAT? When a foreigner creates a permanent establishment in Mexico, or is considered a resident for Mexican tax purposes? In this guide, Doing Business in Mexico explores the common questions that a foreigner has about Mexican Taxes.
Visit our Guide: Taxation in Mexico.
Labor in Mexico
What is Mexico’s labor environment? What is the minimum wage? What about the effects of the United States-Mexico-Canada Agreements (USMCA) on unions and collective bargaining? In this guide, Doing Business in Mexico explores the common employment topics that a foreigner has about Labor in Mexico .
Visit our Guide: Labor in Mexico.
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