Tax incentives for income tax (ISR) purposes in nearshoring operations of taxpayers located in Mexico in key sectors of the export industry.

Con la finalidad de otorgar beneficios a las compañías que buscan optimizar sus operaciones mediante la estrategia del nearshoring que actualmente se ubican en México, y pertenecen a los sectores identificados como clave en la industria exportadora, este miércoles 11 de octubre de 2023, la Secretaría de Hacienda y Crédito Público (SHCP) publicó en la sección matutina del Diario Oficial de la Federación (DOF) del 11 de octubre de 2023 el Decreto por el que se otorgan estímulos fiscales a industria citada consistentes en la deducción inmediata de la inversión en bienes nuevos de activo fijo y la deducción adicional de gastos de capacitación, permitiendo que las empresas extranjeras pueden percibir a México como un destino favorable para establecer sus operaciones y aprovechar los beneficios fiscales otorgados.

This Decree becomes effective the day after its publication, that is, on October 12, 2023, and will be in effect until fiscal year 2024, being applicable with respect to those investments that taxpayers maintain in use for a minimum period of two years immediately following the fiscal year in which the immediate deduction is made.

Among its most relevant aspects are the following:

a) Beneficiaries

• The beneficiaries are legal entities under the general regime of the Income Tax Law (LISR) or the simplified trust regime (RESICO), and individuals under the business and professional activities regime, when these taxpayers are engaged in the production, processing or manufacture and export of the following goods, and estimate that during fiscal years 2023 and 2024 the amount of their export income will represent at least 50% of their total invoicing for each fiscal year:
  1. Products intended for human and animal feed.
  2. Fertilizers and agrochemicals. o Raw materials for the pharmaceutical industry.
  3. Electronic components.
  4. Machinery for watches, measuring, control and navigation instruments, and electronic medical equipment.
  5. Batteries, accumulators, batteries, power cables, plugs, contacts, fuses.
  6. Gasoline, hybrid and alternative fuel engines for cars, vans and trucks.
  7. Electrical and electronic equipment, mechanical systems for automobiles, vans, trucks, trains, ships and aircraft.
  8. Internal combustion engines, turbines and transmissions.
  9. Non-electronic equipment and devices for medical use.
  10. Production of cinematographic or audiovisual works.

b) Immediate deduction of investment in new fixed assets

• The incentive consists of an immediate deduction for new fixed assets (those that are used for the first time in Mexico) acquired from October 12, 2023 through December 31, 2024.
• The amount of the immediate deduction in the year in which the investment is made will be determined by applying to the original amount of such investment the percentages established in such Decree according to the type of fixed assets and the activity for which they are used; the minimum percentage established is between 86% and 89% for property, plant and equipment and between 56% and 88% for machinery and equipment. In the event that the taxpayers are engaged in two or more of the aforementioned activities, the percentage corresponding to the activity in which the taxpayer obtained most of its income in the year in which the immediate deduction of the investment is applied must be applied.
• Specific percentages of the original amount of the investment deducted in relation to the elapsed years of the investment will be applied to investments in fixed assets, products intended for human and animal feed, as well as machinery and equipment.
• It will only be applicable with respect to investments maintained in use for a minimum period of two years immediately following the year in which the immediate deduction is made.
• When the assets are disposed of, lost or rendered useless, a partial deduction may be made.
• The incentive does not apply to office furniture and equipment, automobiles powered by internal combustion engines or automobile armoring equipment.
• Such immediate deduction may be recognized in the provisional income tax payments in the year in which the investment is made, and the immediate deduction made in the same year may be deducted from the taxable income. Likewise, in order to determine the profit coefficient to be used in the provisional payments of 2024 or 2025, the effect of the immediate deduction applied must be included.
• Those who choose to apply this incentive must keep a special record of the investments for which the immediate deduction was applied, such record must include data of the supporting documentation, the fiscal year in which it was applied and the date on which the asset is derecognized.

c) Additional deduction of training expenses

• The incentive consists of an additional deduction of 25% of the increase of the training expense received by each of the employees, applicable in the annual tax return for fiscal years 2023, 2024 and 2025. In case of not applying the deduction in the fiscal year in which the expense is incurred, the right to do so in subsequent fiscal years will be lost.
• Training will be in technical or scientific knowledge related to the taxpayer's activity and provided it is given to active workers registered with the Mexican Social Security Institute.
• Taxpayers applying this incentive must make a specific record of the training provided to the workers and indicate the supporting documentation, as well as describe what the training consisted of and the relationship it has with the original activities for which the taxpayer was benefited.

d) Requirements to be met in order to obtain benefits

• Be registered in the Federal Taxpayers Registry (RFC) and have the tax mailbox enabled.
• Positive opinion of compliance with obligations.
• To file a notice in accordance with the general rules established by the Tax Administration System stating that they opt for the application of the tax incentives during the 30 calendar days immediately following the month in which they are applied for the first time.

e) Excluded or non-beneficiary taxpayers

• Those listed as companies that deduct non-existent transactions or do not rebut the presumption of issuance of tax receipts for non-existent transactions, as well as the presumption of undue transfer of tax losses.
• Have firm tax credits.
• Failure to comply with the established special investment and training records.
• Are in liquidation.
• Are in the procedure of temporary restriction of the use of digital stamps for the issuance of digital tax receipts through the Internet.
• Have cancelled the certificates issued by the Tax Administration Service (SAT).