Mexican government moving quickly to refund value-added tax

By Stephen Downer
Correspondent

Published: May 27, 2014 12:13 pm ET
Updated: May 27, 2014 12:21 pm ET

Image By: Stephen Downer Emilio Cadena Rubio

Related to this story

Topics Public Policy, Mexico

MEXICO CITY — Mexico’s maquiladora industry received a boost this week when the federal government announced it will refund the value-added tax (VAT) levied on temporarily imported machinery and materials used by the sector in its assembly operations within two months.

The sector had feared it could take many months, or even years, for the government to refund the 17 percent tax, introduced in January. But Finance Minister Luis Videgaray said May 21 that President Enrique Peña Nieto had instructed him to pay the refunds over 20 days, starting July 1.

According to government statistics, the 5,000 or so companies that operate within the maquiladora program imported supplies and machinery valued at $156.3 billion free of VAT in 2012 alone.

Index, the National Council of the Maquiladora & Export Manufacturing Industry that represents 20 maquiladora associations across Mexico, calculated that the sector would pay $25 billion in VAT a year.

And because of the expected long delay in getting the money back, many within the industry feared for the very existence of a number of companies.

Responding to the finance minister’s announcement, Index President Emilio Cadena Rubio said: “It’s time to build so that the export manufacturing sector [the maquiladora industry] is seen as a mirror in which Mexico is reflected as a first-world country.”

Earlier this year Cadena said that 40-50 percent of Index’s members work for the automotive industry “and many of them have injection molding operations.”

In excess of 2 million workers are employed by the maquiladoras.


Comments

Mexican government moving quickly to refund value-added tax

By Stephen Downer
Correspondent

Published: May 27, 2014 12:13 pm ET
Updated: May 27, 2014 12:21 pm ET

Post Your Comments


Back to story


More stories

Image

Minnesota receives grant to help develop new bioplastics

September 17, 2014 4:08 pm ET

The University of Minnesota has received a $20 million grant to fund the development of new types of bioplastics.    More

Image

Tiny plastics swim in Australian waters

September 17, 2014 11:16 am ET

A University of Western Australia marine scientist has found the sea's surface in Australian waters is contaminated by more than 4,000 pieces of tiny ...    More

Image

Rise of PP recycling leads to first bale specifications

September 17, 2014 10:22 am ET

PET has its bale specifications for recycling. And so does high density polyethylene. But now comes polypropylene's time.    More

Image

Heineken swapping out plastic for wood for its pallets in Mexico

September 16, 2014 4:35 pm ET

Dutch brewer Heineken NV is to replace all its wooden pallets in Mexico with a high impact-resistant plastic pallet, co-designed and produced by...    More

Image

Canadian, Mexican injection molders form auto supply joint venture

September 16, 2014 2:26 pm ET

A new automotive parts manufacturer will open in Querétaro, Mexico, through a joint venture between Canadian automotive supplier Papp Plastics and Dis...    More

Market Reports

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Shale Gas Market - Analysis of North American Region

This report highlights the impact of shale-based natural gas on the North American plastics market and features an in-depth analysis of production trends in the United States during 2013 and a forecast for 2014 and beyond.

Learn more

Thermoformed Packaging 2014 Market Review & Outlook – North America

This in-depth report analyzes economic and market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as growth strategies being implemented by thermoformed packaging companies.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events