What are taxes like in Mexico?

Mexico's tax system is comprehensive and includes various types of taxes, such as corporate taxes, individual taxes, consumption taxes, property taxes, and international taxes. Here's an overview of Mexico's tax landscape: 1. **Corporate Taxes**: - The corporate income tax rate in Mexico is 30%, which is the standard rate for all OECD countries. - To mitigate the harmful effects of corporate taxes on economic growth, Mexico offers capital allowances that impact business incentives for new investments. 2. **Individual Taxes**: - Resident individuals are subject to Mexican income tax on their worldwide income, regardless of their nationality. Non-residents are taxed only on their Mexican-source income. - Personal income tax rates in Mexico are progressive, with rates ranging from 1.92% to 35% depending on the taxable income. - Individuals are taxed on their compensation, with a tax rate applicable to compensation ranging from 15% to 30% for non-residents. 3. **Consumption Taxes**: - Mexico has a value-added tax (VAT) system, with a standard rate of 16% applicable to most goods and services. - There is also a zero-rate VAT for certain goods and services, such as basic food items and healthcare services. 4. **Property Taxes**: - Property taxes are levied on real estate and are calculated based on the assessed value of the property. - The tax rates for property taxes vary by state and municipality. 5. **International Taxes**: - Mexico imposes withholding taxes on certain types of income, such as interest, dividends, and royalties, earned by foreign entities from Mexican sources. - Foreign investors may also be subject to Mexican taxes on capital gains realized from the sale of Mexican securities or assets located in Mexico. Key Takeaways: * Mexico's tax system is robust and includes a mix of income, consumption, and property taxes. * The corporate income tax rate is 30%, with capital allowances to encourage investment. * Individual income taxes are progressive, with a range of rates based on taxable income. * Consumption taxes, such as VAT, are applied to goods and services. * Property taxes are based on the value of real estate, with varying rates across different regions. * International taxes apply to foreign income earned in Mexico. For more detailed information, please refer to the references provided.