On April 5, 2020, the President of Mexico submitted a government report to announce the emerging program for welfare and employment that will be applied due to the global contingency of COVID 19.
In general terms, the “economic reactivation” plan of the Government of Mexico consists in the expansion of social programs that have already been implemented, increasing the aid, pensions and other concessions granted, in an attempt that said social and development programs reach 22 million beneficiaries.
Likewise, it is intended to grant 2 million 100 thousand personal, housing and small family business loans in the formal and informal sector of the economy and create 2 million new jobs in 2020.
Therefore, the announced plan does not include any type of commercial, administrative, financial or tax measure for individual taxpayers and companies. However, the Government will agree to expedite VAT reclaims.
It is important to mention that in order to guarantee the government’s social and development programs, Article 4 of the Constitution was amended to grant, by legal mandate, pensions to all older adults in the country, to poor girls and boys with disabilities, scholarships to students from low-income families and guarantee to all Mexicans the right to health, with free medical attention and medications; with the financing of the Budgetary Income Stabilization Fund, the resources that were kept in trusts, the development bank and the austerity program.
In short, the Government of Mexico has announced the implementation of the following actions:
- Advance 4 months pension payments for 8 million older adults, through banks and the personal delivery of 42 billion MXN.
- Advance the payment of pensions for poor girls and boys with disabilities.
- Deliver 10 million 500 thousand scholarships to students of all school levels and at Benito Juárez universities.
- Give small family businesses 356,000 credits from the Microcredit Scheme for Welfare, adding 450,000 more this year with a total investment of 3,400 million MXN.
- Do not increase fuel prices.
- Expand the Sembrando Vida program, which gives permanent employment to 230,000 sowers, so that 200,000 more farmers have jobs immediately and 190,000 fishermen receive direct support as of May.
- Provide additional support to parents’ societies for the maintenance of 31,000 school campuses.
- Have a fund of 35 billion MXN from ISSSTE to deliver personal loans ranging from 20 thousand to 56 thousand MXN to 671 thousand workers at the service of the State.
- Grant, through Fovissste and Infonavit, MXN 175 billion for housing loans, for nine months in 2020, for the benefit of 442,500 workers and the same who will generate 970,000 jobs.
- Continue the program of tax incentives and low prices for gasoline and other energy in the northern border of the country.
- Do not increase taxes or create new ones.
- Expedite VAT reclaim process of taxpayers.
- Switch the current publicity schedules regarding tax on radio stations and open television channels to broadcast educational, cultural and social interest topics, so that it can be marketed instead in the media.
- Increase the production of gasoline in the country; Allocating an additional 400,000 barrels a day for this purpose to waste all exported oil and not lower the purchase of fuels abroad.
- Reduce salaries of high public officials and eliminate bonuses from the position of deputy directors to that of the President of the Republic.
According to information disclosed by Mexican Government no further benefits or measures from above mentioned be instructed to face COVID-19 financial crisis.
Access the document here.