Fiscal Transformation for Pemex: New Changes in the Oil Landscape

This Wednesday, the Mexican government unveiled a new fiscal model for the national oil company Pemex, which includes the reduction of tax contributions to just one, linked to the company’s hydrocarbon production.

The state-owned oil company, which is facing serious debt issues, will now have to pay the well-known "Oil Royalty for Well-Being,” replacing the three royalties it previously owed: the Royalty for Exploitation, the Royalty for Hydrocarbon Extraction, and the Royalty for Shared Profit. This information was provided by Deputy Secretary of Finance, Edgar Zamora, during the daily press conference led by President Claudia Sheinbaum. "The president instructed us to simplify the tax system in order to streamline the process and focus Pemex’s productive and operational efficiencies into a single royalty," the official noted. The new tax, set for 2025, will have a general rate of 30%, and for non-associated gas, it will be 11.63%, taking into account production projections and hydrocarbon prices for the coming year. Zamora emphasized that this change will not impact the country's public finances. Additionally, he mentioned that Pemex will meet its debt commitments, which amount to about $97 billion, thereby avoiding the need to turn to capital markets in the short term, with the aim of strengthening the company's financial situation.

This is a significant step taken by the government to simplify the fiscal framework for Pemex, as it could promote investment and enhance its operational efficiency. However, the company still faces a major challenge with its debt, and it will be crucial to monitor how these changes affect its long-term financial stability. Proper management and a proactive approach to its production could make the difference between recovery and further deterioration of its economic situation.