Small Fiscal Adjustments Expected for 2025, According to Sheinbaum
Claudia Sheinbaum, the President of Mexico, stated that in the 2025 Economic Package to be presented today by the Ministry of Finance to the Congress of the Union, there will be minor modifications in terms of taxes, commonly referred to as the tax miscellaneous. In a press conference, she explained: "This year we will make some minor adjustments to the miscellaneous, and next year we will focus on enhancing revenue collection at customs, simplifying procedures at the Tax Administration Service (SAT) to improve revenue, as well as strengthening mechanisms to prevent tax evasion."
Republican Austerity Will Continue
During a recent hearing, Rogelio Ramírez de la O, the Secretary of Finance, assured members of the House Finance and Public Credit Committee that the government understands the need to generate more income while stating that spending remains rigid. Should a tax reform be necessary, it will be the President who delivers that news. "We will be working on this and will review with various sectors whether additional reforms are needed, although I believe there are still many opportunities to increase revenue without making drastic tax changes," he told the press. Regarding spending, Sheinbaum indicated that there will be significant changes to reduce the fiscal deficit, which also requires effort from the entire government to maintain Republican Austerity; however, she assured that this will not impact government operations, as social programs, public investments, and the strengthening of Pemex will be guaranteed, which will positively affect the country's finances. Regarding Moody's Ratings downgrade from positive to negative, she emphasized that it is necessary to present more arguments to support the institutional weakening mentioned by the rating agency. She recalled that rating agencies base their evaluations on economic models different from the current administration's, but emphasized that there remains high interest from both domestic and foreign investors to invest in Mexico, and that the teams from the Ministry of Economy and Finance are working diligently to ensure capital flows into the country.
It is interesting to observe how the Mexican government is focusing on revenue collection without the need for a deep tax reform. This could be seen as a strategy to maintain short-term financial stability. However, in the long term, it is crucial to implement measures that promote greater efficiency in revenue generation and build investor confidence. Diversifying revenue sources and combating tax evasion emerge as priority objectives that, if achieved, could significantly strengthen the country’s finances.
