Mexicans Blindsided by New Value-Added Food Tax, Effective as of July 1 Frontera NorteSur
go to original June 29, 2015

If you fetch a quick quesadilla or hot dog in Mexico, expect to pay more very soon. Beginning July 1, the 16 percent value-added tax (VAT) will be added to popular prepared foods sold in supermarkets and convenience stores. The new federal tax will cover a variety of foods consumed by busy Mexicans who find less and less time to cook at home, including tortas, tamales, sandwiches, flautas, tacos, hot dogs, roasted chickens, and much more.

Food prepared and sold in restaurants has long been subject to the 16 percent VAT, but until now similar foods offered at commercial outlets for takeout consumption have been exempt from the tax. Unprepared foods remain VAT-free – at least for now.

Talk of taxing food and medicine after the administration of President Enrique Peña Nieto took office, in late 2012, caused a popular uproar and prompted pledges by the new president’s administration that it would not tax essential items.

During the mid-term congressional and state/local election campaigns, that concluded earlier this month, the possibility of a new food tax was not on the political agenda. But shortly after the June 7 elections, the Tax Administration Service quietly added the VAT to prepared foods outside restaurants as part of a set of new resolutions published by the federal agency and set to go into effect on July 1.

The pending tax will increase costs for Mexican consumers who’ve been hit hard with price hikes on many different food products, both prepared and unprepared, in recent years.

Read the rest at MexiData

Photo: Cuartoscuro/Rodolfo Angulo

Related: Added Fast Food Tax Nothing New (The News)

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