The federal government has stated that for him fiscal year 2022 will present a proposal for Tax Reform with the aim of raising higher income through the Income Tax (ISR) in higher income tranches, recalibration of rates and combat tax evasion.
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Given this, the Senate reported that it is already preparing for the analysis of said initiative at the time it is sent to Congress, which must be ruled, first in the Chamber of Deputies, and then reviewed in the upper house.
The Belisario Domínguez Institute (IBD) of the Senate presented an analysis where he points out that, in the discussion of the Tax Reform, It is expected that the greatest weight to keep public finances in good condition will be with the increase in income tax rates.
The research titled “Elements and Considerations for a New Tax Reform”, prepared by researchers José Luis Clavellina, Mario Iván Domínguez and Vladimir Herrera, details that for the year 2020, the income of the general government represented 22.4% of GDP, while the average in the countries of the Organization was 41.5%.
“Income tax for individuals could be the central axis of said reform (…) the maximum marginal rate in Mexico is 35.0%, while in countries such as Canada, Israel and Japan these rates range from 50.0% to 60.0%. In addition, it points out that in Mexico to reach this rate, one would have to earn 26 times the average salary (that is, 10,968 pesos per month times 26), while, for OECD countries, said maximum rate is reached with incomes between 10 and 20 times the average salary, so there is a lack of progressiveness in relative terms, ”the study refers.
Likewise, the IBD indicates that it is essential to consider whether the federal government’s priority programs and projects are sufficiently profitable in economic and social terms to grant them greater public resources, through the increase in income tax or creation of new taxes.
Faced with this scenario, the IBD document highlights that various specialists and international organizations have pointed out the need to carry out a Tax Reform that contributes to public resources that allow financing the provision of public resources and carry out New public policies for the development of the country are needed.
The study considers that among elements that the tax reform should take into consideration are: generational change that the population is going through; the need for more progressive income taxes, especially with higher brackets in the highest income decile; combat tax evasion and avoidance.
Likewise, evaluate the viability of applying wealth taxes; the reduction of fiscal expenses; the promotion of private investment and saving; expanding the taxpayer base; tax the digital economy.
Also, expand environmental taxes; take into account the gender perspective and inclusive growth; greater quality and effectiveness of public spending, greater transparency, a boost to the traceability of resources and accountability.
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Likewise, the study says, it is necessary to evaluate the design and recalibrate the existing rates or quotas of special taxes on products that are currently taxed (alcohol, tobacco, sugary drinks, fuels, pesticides, etc.), as well as new products. that they will be taxed (cannabis and its derivatives, for example); and label and channel the resources collected by this tax to address health and environmental problems generated by the consumption of these products, the study maintains.
Regarding fiscal federalism, the IBD refers, it is necessary to rethink the competences between the federal government and the governments of the federative entities and municipalities, both with respect to income and public spending, for which a resizing of the orders of government, tax powers, as well as transfer and compensation mechanisms, possibly from the constitutional scope.