On 31 December 2018, Mexico published in the official gazette a decree on tax incentives for northern border regions. The incentives include:
- An income tax credit equal to 1/3 of the tax due for a period, which effectively reduces the corporate income tax rate from 30% to 20%; and
- A 50% VAT credit that can be applied directly at the time of a transaction and effectively reduces the VAT rate from 16% to 8%.
The incentives apply for income exclusively sourced in the qualifying regions (see …