Mexican tax authorities recently released effective tax rates (ETRs) intended to serve as parameters for measuring tax risks that correspond to over 200 economic activities. The stated objective is to facilitate and encourage voluntary tax compliance by inviting taxpayers to analyze the applicability of the ETRs, compare them with their own and, as expressed by the authorities, self-correct their tax positions, if appropriate. According to the authorities, this should reduce the need for in-depth tax reviews focused on verifying that taxpayers have complied with their tax obligations.
The takeaway: Even though different internal and macroeconomic factors impact the ETRs, taxpayers should analyze this information and diagnose their financial and tax calculations. In addition, they should document any deviations and seek to demonstrate the commercial and business rationales driving their profitability, particularly where a significant deviation exists.
