Implements new incentives to promote nearshoring
11 Oct 2023
On 11 October 2023, the President of Mexico issued a decree aimed at providing fiscal incentives to companies in key export industries. The decree focuses on promoting nearshoring, encouraging companies to relocate part of their production to Mexico.
The identified key sectors include semiconductors, automotive (especially in electromobility), electrical and electronic equipment, medical devices and pharmaceuticals, agribusiness, and human and animal food. The goal is to maximize Mexico's competitiveness in these sectors and attract foreign direct investment.
New tax incentives include:
- accelerated depreciation for investment in new assets made from 12 October 2023 through 31 December 2024.
- An additional tax deduction for increases in workforce training expenses made in 2023 through 2025 (deduction applies to expenses exceeding the average spent in 2020-2022).
The new incentives will apply to companies and individuals engaged in the production, manufacture and export of certain categories of goods from the above targeted sectors. The incentives are limited for enterprise that exports goods from these targted sectors..
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Type:
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Promotion and facilitation (Investment incentives)
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Industry:
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Manufacturing (Manufacture of food products, beverages and tobacco products, Manufacture of basic pharmaceutical products and pharmaceutical preparations, Manufacture of computer, electronic and optical products, and electrical equipment, Manufacture of transport equipment)
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Sources:
