Monday, February 6, 2023

Fortune tax will leave the government 270,000 million pesos

The establishment of a progressive federal tax on large fortunes in Mexico would allow 270,000 million pesos to be collected annually, an amount sufficient to increase spending on public health by about 40%, or 17 times the federal spending allocated to environmental protection today, an Oxfam Shows report Mexico.

Through the report “Who Pays the Bills? The myth behind taxes on large fortunes in Mexico”, the organization proposes setting a tax rate of 2% for those with more than 20 million pesos, and 3% for those whose wealth is above 100 million pesos. , and 5% for billionaires (those with a net worth of more than 20,000 million pesos or $1,000 million).

It also recommends promoting deep, progressive and transparent tax changes, in order to “begin to transform the current state of the Mexican tax system”; review the tax privileges of the richest 1%; Prioritizing public investment in social infrastructure such as health, education and care, and promoting the active participation of the Mexican government in regional financial discussions.

Necessary amendments, both in federation and sub-national governments, detail, should prioritize the progressive collection of public money and who pays this money and for whom.

“These amendments should aspire to a systematic increase in income tax to 1% of the highest income, equalizing the rates charged for both work and capital, boosting taxes on large inheritances and donations, and reviewing existing taxes on wealth.” do, such as property and tenure, so that they collect better and from those who have more property ”, he specifies.

With regard to the proposal to review the tax privileges of the richest 1%, it proposes to evaluate, investigate and eliminate tax exemptions and other tax privileges in the tax code as they top the people with the highest income and fortune in the country are concentrated. ,

rich after the pandemic

Despite progress in the federal government’s social and labor policies and amid various contagion crises caused by the effects of the Covid-19 pandemic, the document noted, the ultra-wealthy in Mexico have seen their fortunes grow by a third (33%) since the start of the pandemic.

“For every 100 pesos created between 2019 and 2021, 21 pesos went to the richest 1% and just 0.40 pesos to the poorest 50%. Only Carlos Slim, the richest man in Mexico and Latin America and the Caribbean, concentrates more wealth than half of the Mexican population and has seen his wealth rise by 42% since the start of the pandemic, adding up to 1 million per hour. equal to the US dollar. ,

“However, these numbers do not reflect the portion of the bill that the super-rich pay. Taxpayers with incomes above 500 million pesos per year represented barely 0.03% of total tax collections. In addition, large companies effective ISR rates of between 1 and 8% of their total income paid through 2021, much lower than the 30% established by law. When the super-rich don’t pay, we pay,” the report said has gone.

And that not only do the tax contributions of the ultra-wealthy not match their ability to pay, but they also use various mechanisms to pay less taxes.

“An example of this can be found in the recent litigation of Grupo Salinas, which, following a resolution of the Supreme Court of the Nation, had to pay 2,776 million pesos. However, the said amount barely represented 7% of the total amount owed by that consortium. does, which amounts to about 37,000 million pesos”, he specifies.

Finally, it details that “It is estimated that 400,000 million pesos in business profits in Mexico are transferred annually to tax havens, further reducing the Mexican government’s collection capacity.”

Nation World News Desk
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