Mexican law firm Ibarra, del Paso y Gallego is pleased to announce the promotion of Rodrigo de los Ríos Gordoa to Partner, and of Alejandra Gutiérrez Pérez Avena and Sandra Jiménez Huerta to Of Counsel. The appointments are effective on January 1, 2020.
KEY AMENDMENTS TO THE UNITED STATES, MEXICO AND CANADA AGREEMENT (T-MEC) ACHIEVED IN THE NEGOTIATION OF THE AMENDING PROTOCOL OF THE T-MEC
This past December 13th, the Mexican Senate approved the Amending Protocol to the United States, Mexico and Canada Agreement (“T-MEC” and jointly, the “Protocol”). Through the Protocol, certain amendments were made to the T-MEC, primarily with respect to the following topics:
On December 17, 2019, the Federal Government announced the increase on the minimum wages for next year.
The Minimum Wage Commission determined that the increase on the minimum wage will be of 5% as a real salary increase, plus an increase of $14.67 Mexican Pesos as a “Independent Recovery Figure” designed to improve the minimum wage in Mexico.
The Superior Chamber of the Tax Court (the “Tax Court”) recently ruled that advertisement expenses for trademarks are not deductible for taxpayers that do not own the publicized trademarks and that only have the use of such trademark by a non-exclusive license agreement. The rationale of the Tax Court was that publicity or advertisement expenses aim to bolster the value of a trademark owned by the licensor and not the licensee. Therefore, the licensor is the one who should incur in publicity expenses of its brand and not the licensee who does not own it. Consequently, if a licensee incurs in such expenses, they would not be strictly indispensable and therefore not deductible under the income tax law as they are not directed for promoting a brand of its property.
The insecurity and widespread violence that have characterized the northern border of Mexico (the “Border”),have become one of the most urgent and important matters to be addressed by the Mexican government, as such problems have unleashed an economic slowdown along the 180 kilometers of the Border shared with the United States of America.
In order to establish mechanisms that strengthen the economy of taxpayers in the northern border of the Country, to stimulate and increase investment, as well as to promote productivity and contribute with the creation of employment sources, on Monday December 31st 2018 and on Monday, January 7th 2019, the decree on tax incentives in the northern border region (the “Executive Order”) and the anticipated revenue rules for applying the Executive Order (the “Rules”) were published. The Executive Order and the Rules establish benefits pertaining to income (Impuesto Sobre la Renta “ISR”) and to value added taxes (Impuesto Sobre el Valor Agregado “IVA”):