Fiscal stimuli from the northern border cost more than planned and did not benefit the poorest

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By CAPosts 02 December, 2020 - 05:31pm 31 views

The government has stopped collecting 154 thousand 720 million pesos on the northern border due to these fiscal stimuli.

© Provided by El Taxpayer

One of the campaign promises of President Andrés Manuel López Obrador was the implementation of fiscal incentives in the northern border of the country. Over time, the president announced that he would extend the stimulus package for a longer time, in addition to contemplating the possibility of implementing a similar one, but on the southern border of the country.

However, the tax expenditure that the federal government has to make to sustain these programs (that is, what the government stops collecting due to fiscal stimuli) is considerable

Before the stimulus came into effect, in December 2018, the then Secretary of Finance and Public Credit, Carlos Urzúa , He said that even though there was talk that the fiscal stimuli would generate a fiscal gap of between 80 and 100 billion pesos, it would not be the case, since they would be very careful with companies that are domiciled in the benefited area. , government spending for fiscal stimuli was 118 thousand 827 million pesos , according to the data that comes from the 2019 Fiscal Expenditure Budget , which summarizes the government's tax expenditures. During the fiscal year

The discrepancy between the figure offered by the former secretary and the one reported in the official document is that Urzúa did not contemplate the revenue loss that would imply the stimulus to the IEPS of gasoline.

Of these, 71% came the stimulus to the special tax on production and services (IEPS) for gasoline; 27% of the reduction to half of the value added tax (VAT); the remaining 2% of the reduction by a third to the income tax (ISR) of legal entities

The amount allocated in 2020 for stimuli is significantly lower, of 35 thousand 893 million pesos, since the stimulus to the IEPS of Gasolines, which in 2019 was 84 thousand 722 million pesos, did not apply in 2020.

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Thus, the collection that the government has waived for these stimuli during these two years is 154 thousand 720 million pesos.

The news portal The CEO reports that, according to the chief economist of the Mexican Institute for Competitiveness (IMCO), Manuel Montaño, these fiscal stimuli will not generate benefits for people with fewer resources.

“A formal merchant who may be in El Paso or Ciudad Juárez is going to take advantage of any difference in prices that may exist. on either side of the border, while a more humble merchant who cannot cross is not going to be able to do this kind of thing, "he said.

For his part, Kristóbal Meléndez, Mecademi research coordinator, told the CEO that this type of incentives generate fiscal pressure for the budget, in addition to affecting businesses located in regions not benefited by the stimuli.

Last year, Rubén Ignacio Moreira Valdez, federal deputy of the Institutional Revolutionary Party (PRI), pointed out that these stimuli would affect the municipalities located outside the benefitted 20-kilometer strip , since consumers would prefer to buy in the border area, as there are more competitive prices.

“It is required That the deputies analyze together with the tax authorities the particularities of each state and municipality, because the populations near the border area will lose competitiveness, placing them in a serious economic crisis, since consumers will seek better prices for products and services in stores sheltered with stimuli prosecutors ”, said the legislator.

With information from The CEO .

https://elceo.com/economia/estimulos-fiscales-a-la-frontera-cuestan-mas-de-200000-mdp-a-la-recaudacion /

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The entry Fiscal stimuli from the northern border cost more than planned and did not benefit the poorest was published first in the Taxpayer .

Source: MSN