TAX INCENTIVE: PLAN MEXICO 2025

On January 21, 2025, the Official Gazette of the Federation published a decree issued by the Executive Branch, granting a series of tax benefits for entrepreneurs looking to invest in Mexico. These benefits are part of the national strategy announced in the morning press conference on January 13, 2025, by the President of Mexico.

These incentives aim to benefit various economic sectors, such as commerce, industry, and tourism, where Mexico and its business community require fiscal stimuli to encourage investment and economic growth. This decree could be a first step, with the business sector expecting additional tax incentives in the near future, particularly for small and medium-sized enterprises (SMEs).

Below are the five key points to understand about the Plan Mexico tax package:

1. Who is eligible for this benefit?

If you are a business owner operating under a corporate entity that generates wealth—such as a Limited Liability Company (LLC), Corporation (S.A.), Civil Association (S.C.), or similar—you may qualify for this tax benefit.

Likewise, if you conduct business activities or provide professional services as an individual taxpayer, you can also apply for this tax incentive.

2. What does the tax benefit consist of?

The main advantage of this tax incentive is the ability to immediately deduct investments made. For example, if a restaurant business invests in machinery during this fiscal year, it can deduct up to 83% of the investment in the same fiscal period, instead of applying depreciation over time.

These fiscal benefits primarily apply to two categories:

• Training expenses: 25% deduction on the investment made.

• Investments in fixed assets, such as machinery, construction, and other capital expenditures.

The percentage of deductible expenses will depend on the type of business activity and the asset acquired.

3. What is the economic impact?

The economic impact for business owners is the ability to defer the payment of Income Tax (ISR), which represents 30% of the invested amount, providing a significant financial relief.

Before making such investments, it is essential to conduct a thorough financial analysis to optimize the benefits and confirm their applicability for the fiscal periods in which Plan Mexico remains in effect.

4. What are the requirements?

In addition to having an electronic signature, being registered in the Federal Taxpayer Registry (RFC), and having a verified tax address, businesses must meet the following criteria:

• Not be involved in simulated transactions.

• Have no outstanding tax liabilities.

• Not be subject to digital tax seal cancellations or restrictions.

• Maintain a positive tax compliance status with the tax authorities.

Additionally, one essential requirement is to submit an investment project to the evaluation committee for approval, ensuring compliance with the guidelines, which must be published no later than March 21, 2025.

5. Duration of the Program

The decree is effective from January 21, 2025, until September 2030. During this period, the oversight committee will publish the annual amounts available for each fiscal year, within the authorized fund of 30 billion pesos.

Conclusion

It is crucial to closely monitor the committee’s guidelines and, together with a team of tax advisors, analyze the economic impact of implementing Plan Mexico in your business. This initiative represents a positive step forward, although additional fiscal benefits are expected to continue fostering economic growth in the country.