Acapulco Guerrero. The Secretariat of Finance and Public Credit (SHCP) does not have the power to implement tax incentives on the Special Tax on Production and Services (IEPS) state that is charged to gasoline, said Gabriel Yorio, undersecretary of the agency.
“We do not have power over state taxes, we have over federal (taxes) and that is where we can apply the stimuli, but the state IEPS is collected and determined by the States. If they wanted to give an incentive, I think the economy would appreciate it very much,” the official told the media, prior to the 85th Banking Convention, to be held on March 24 and 25.
Currently, the SHCP apply a fiscal stimulus and another complementary to gasoline due to the increases that have occurred in the international price of oil, which in turn affect gasoline prices; however, the fiscal stimulus is only for the IEPS federal, and not the state, whose fee varies depending on the state.
Regarding the fiscal stimulus applied to the IEPS At the federal level, Gabriel Yorio explained that this tax cannot have a negative collection, as was observed in past years when gasoline was subsidized, for which the complementary fiscal stimulus came into effect which, in his opinion, is working quite well. .
“IEPS self-finances the stimulus applied to gasoline. So what is being collected can be used to finance this stimulus to a certain extent. From that point other additional stimuli enter, which is what we have just activated. There cannot be a negative IEPS and that is why there are other additional stimuli”, he expressed.
At the beginning of the month, the SHCP implemented a complementary subsidy to gasoline, which will be activated each time the existing fiscal stimulus in the IEPS reach a rate of 100 percent. This complementary incentive may be credited against the ISR or VAT at the taxpayer’s expense.
The official stressed that Mexico is not the only country that has applied fiscal stimuli to avoid sharp increases in gasoline prices, such as Canada, the United Kingdom, the United States and Italy.
“The stimulus is working well and we are not the only ones doing it. There are other countries such as Canada, the United Kingdom, the United States, and Italy that have already activated similar subsidies. It must be remembered that Mexico has a very advanced and sophisticated financing design for these stimuli compared to other countries. In our case, the additional stimulus is practically a countercyclical incentive to the impact that we are receiving from abroad regarding the increase in oil prices”, he pointed out.
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