Adopts new tax incentives for special economic zones in Yucatan
29 Jun 2024
On 28 June 2024, the Government of Mexico published a decree in the Official Gazette on new tax incentives in two "Welfare Industrial zones" of Yucatan.
The decree grants tax incentives to taxpayers engaged in productive activities within the welfare industrial zones of Progreso I and Mérida I, created on 27 June 2024 by the State of Yucatan. The decree targets 11 specific sectors, as follows:
- Electrical and electronics sector
- Semiconductors
- Automotive (electromobility)
- Auto parts and transportation equipment
- Medical devices
- Pharmaceuticals
- Agroindustry
- Equipment for the generation and distribution of electric power (clean energy)
- Machinery and equipment
- Information and communication technologies
- Metals and petrochemicals
The key incentives include:
- Income Tax: 100 per cent tax credit for the first three years, 50 per cent for the next three, potentially up to 90 per cent for meeting employment targets. Immediate 100 per cent deduction for new fixed asset investments for six years.
- VAT: 100 per cent credit on VAT for activities within the zones if not passed on to buyers.
To qualify, companies must meet certain conditions, such as being up-to-date with their tax obligations, presenting an investment project, and having a fiscal domicile within the zones.
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Type:
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Promotion and facilitation (Investment incentives, Special economic zones)
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Industry:
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Not industry specific (SDG)
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Manufacturing (Manufacture of food products, beverages and tobacco products, Manufacture of chemicals and chemical products, Manufacture of basic pharmaceutical products and pharmaceutical preparations, Manufacture of basic metals, Manufacture of fabricated metal products, except machinery and equipment, Manufacture of computer, electronic and optical products, and electrical equipment, Manufacture of machinery and equipment n.e.c.)
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Services (Telecommunications)
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Sources:
