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

Residents ask court to close pipe maker

November 21, 2014 3:22 pm ET

Residents living by National Pipe & Plastics Inc.'s new factory in an industrial zone of Endicott, N.Y., say the facility has “devastated the...    More

Image

Need for skilled workers is unchanged, but method of finding them has

November 21, 2014 6:00 am ET

It's in the news nearly every day now: “How can manufacturing solve the skilled worker shortage? We need to get young people interested in...    More

Image

Ineos making its UK shale play

November 21, 2014 9:29 am ET

Chemical giant Ineos Group AG is planning to be the biggest player in the United Kingdom's shale gas industry.    More

UK court hearing case of rotomolding worker killed in 280° C oven

November 21, 2014 9:00 am ET

The management at a United Kingdom rotational molding plant are facing criminal charges for the death of a worker who was trapped inside a 280°...    More

Image

UK plastics firms target customers in Mexico and Central America

November 20, 2014 4:31 pm ET

The British Plastics Federation is stepping up its interest in Latin American markets, as evidenced by its debut appearance at the Plastimagen México ...    More

Market Reports

Plastics in Brazil - State of the Industry Report

This in-depth report examines the Brazilian plastics industry from a historical and geographical context. Our analysts provide insight on economic trends and forecasts, growing manufacturing sectors that utilize plastics, private investment opportunities, market environment challenges, and innovations in R&D.

Data tables and charts on producer prices, trade, plastics production and end market indicators is also included.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Injection Molders Market Report & Ranking 2014

This special package contains our 132-page 2014 Market Report on the Injection Molding segment and our exclusive 2014 RANKINGS database of 500+ Injection Molders for a discounted package price.

Learn more

Upcoming Plastics News Events

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

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

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

October 27, 2015 - October 29, 2015Plastics Financial Summit - New York - 2015

More Events