Peru and Mexico manage fiscal shifts and budget planning

fiscal deficit public budget tax revenue income tax macroeconomic framework

Peru and Mexico are navigating significant fiscal adjustments and budget planning. In Peru, the Ministry of Economy and Finance (MEF) projects the fiscal deficit will decrease to 1.8% of GDP by 2026, potentially reaching 1.4% by 2027. The government has submitted the 2027 Budget, Debt, and Financial Equilibrium Law projects to Congress, requesting urgent processing. The proposed 2027 budget is estimated at over S/ 266,506 million, a 3.5% nominal increase from 2026, with significant allocations for education and transport.

In Mexico, tax revenue data for the period of January to July 2026 shows mixed results. While total government income grew nominally, tax collection faced challenges due to a significant decline in Income Tax (ISR) revenue. The ISR saw a real annual decrease of 6%, the largest drop since 2010, attributed to lower payments from corporations. This decline was partially offset by strong performance in Value Added Tax (IVA) and Special Tax on Production and Services (IEPS), driven by resilient domestic consumption and improved customs oversight.