Fuel smuggling fell 32% due to IEPS stimulus: SAT

The Tax Administration Service (SAT) revealed that fuel smuggling represented some 16.9 million barrels in the first quarter of the year, this represented a contraction of 32% compared to the same period last year.

In the Tax and Management Report, prepared by the treasury, this decrease in smuggling was explained by the increase in tax incentives for the Special Tax on Production and Services (IEPS) as a result of recent geopolitical events.

Raquel Buenrostro, head of the SAT, said at the time that tax incentives have a benefit in public security since smuggling is combated since the IEPS is not charged.

Smuggling in the first quarter of 2021 against 2022 decreased because there is no incentive today, nobody pays IEPS from importers. The smuggling was done to avoid paying the tax,” said Buenrostro Sánchez a few days ago.

The SAT reported that the demand for fuel in the country was 114.8 million barrels, smuggling represented 14.7% of the total during the first quarter. In the first three months of 2021, the total demand for fuels amounted to 112.5 million barrels and contraband represented 22.1% of the total.

Legitimate imports registered 57.9 million barrels and that produced by Petróleo Mexicanos (Pemex) represented 39.9 million barrels in the first three months of the year. Together they represented 97.8 million barrels or 85.2% of total supply in the first quarter of 2022.

In legitimate imports, there was an annual decrease in supply of 3.6 million barrels, while in the case of Pemex it had an annual increase of 6.6 million barrels, according to the SAT.

It should be remembered that the volume of contraband was estimated at 102 million barrels in 2021, this is the equivalent of 27% of legitimate fuel sales and 41% of legitimate fuel imports.

Raquel Buenrostro mentioned that they have a registry of 16 companies with permission to import fuels, however, only eight have imported during the first quarter of the year.

oil smuggling

Meanwhile, the SAT revealed that lubricants and other viscous liquid goods are not subject to the payment of IEPS, so they are used as a means of tax evasion.

In the first quarter of 2022, the total volume of lubricants was 4.5 million barrels per month, which represents a decrease of 13% compared to the first quarter of last year.

This is explained because it is not convenient for smugglers to report gasoline or diesel as oils and liquid goods, since they do not receive the complementary fiscal stimulus focused on fuels.

For the first quarter of 2022, there was a 69% decrease in the volume of lubricant imports to the country.

During fiscal year 2021, an increase in imports of lubricants was observed, exceeding legitimate demand by 79% without any support in economic activity.

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