Relevant tax developments in Mexico

Mexican companies are encouraged to note two recent tax developments within the country. Below, we take a closer look.

President Sheinbaum announces Plan México

Mexican President Claudia Sheinbaum has announced an economic development strategy called “Plan México,” which aims to attract private national and foreign investment, develop industrial growth, and create social and economic hubs within the country.

On January 21, 2024, the day before the announcement, the “Decree Granting Tax Incentives to Support the National Strategy ‘Plan México’ to Promote New Investments, Dual Training Programs, and Innovation” (Decree) was published in the Official Gazette, granting the following incentives to all businesses in all the country:

• Accelerated depreciation deduction. This incentive allows eligible taxpayers an immediate income tax deduction of investments in certain new fixed assets. The immediate deduction will correspond to the amount resulting from applying the accelerated depreciation rates established in the Decree (instead of the ordinary depreciation rates provided by the Income Tax Law) and will only be applicable to assets that are acquired from January 22, 2025 to September 30, 2030 and that are used for a minimum period of two years. The list of eligible assets is broad and includes certain construction projects, railway and railroad equipment, boats, aircraft, certain automobiles, computer equipment and certain electronic devices, and infrastructure for telephone and satellite communications, among others. Accelerated depreciation rates range from 35 to 91 percent depending on the type of asset.


• Additional deduction for eligible employees training and innovation expenses. This incentive allows for an additional 25 percent deduction from the increase in expenses incurred for employees’ training or innovation during fiscal years 2025 to 2030. The increase in expenses is the positive difference between the total expenses incurred in employees’ training or innovation during the fiscal year and the average of the same expenses incurred in the three preceding fiscal years.

Training is eligible if it provides technical or scientific knowledge related to the activity of the taxpayer, and innovation expenses are eligible if related to investment projects for the development of patentable inventions, as well as those investment projects developed to obtain initial certifications for integration into local or regional supply chains.

Modification to Annex 1-A of the Miscellaneous Tax Resolution for 2025 regarding documentation accepted as proof of address

On January 14, 2025, Annex 1-A of the Miscellaneous Resolution for 2025 came into effect. Among other specific changes, the Mexican Tax Authority determined that as of 2025, lease and sublease agreements would no longer be accepted as proof of address. The amendment implies that the only type of agreements that will be accepted as proof of domicile will be service agreements granting the use of the space used as domicile, trust deeds, and utility agreements (eg, energy, phone, internet, and water).

The implications of this modification are particularly relevant to a wide range of taxpayers, including newly incorporated entities, established businesses planning to incorporate or re-domicile a Mexican company, and groups of companies that share the same premises as tax domicile. Besides several tax procedures requiring taxpayers to present a valid proof of address, recently tax authorities have been active verifying tax domiciles, in some cases taking aggressive actions, such as suspending digital seals, which impede taxpayers from issuing invoices, when finding issues in the registered tax domicile.

New businesses are encouraged to analyze the documentation that will have to be prepared and/or obtained by the Mexican entities that register in the Federal Taxpayers Registry, as the lease or sublease agreements that were commonly used as proof of address are no longer acceptable. Also, established businesses that provided a lease or sublease agreement as proof of domicile to tax authorities are encouraged to review their situation and gather other acceptable proof of domicile to be prepared in case of a review by the tax authorities.