Mexico's SME Tax Reform Faces Critics Over Lack of Incentives

A proposal to amend Mexico's Income Tax Law aims to create a dedicated fiscal regime for micro, small and medium enterprises (MiPymes). The draft seeks stable tax rates, refundable credits and longer‑term incentives, arguing that current rules penalise firms that invest in growth.

The author warns that without such measures, the informal sector will remain large – over 67 % of MiPymes operate informally and only one‑quarter obtain formal credit – while recent fiscal changes, such as a 10.5 % digital‑sales levy and higher excise taxes, have increased costs for small businesses.