Tax incentives decree to promote investment in specific areas of the state of Yucatán

The economic activities covered in the decree include:

• Electrical & Electronics
• Semiconductors
• Automotive (electromobility)
• Auto Parts & Transportation Equipment
• Medical devices
• Pharmaceutical
• Agro-industry
• Electrical power generation and distribution equipment (clean energies)
• Machinery and equipment
• Information and communication technologies
• Metals and petrochemicals.

In addition to the above, any taxpayers who wish to apply the fiscal incentives must comply, among others, with the following requirements:

• To have fully paid all their tax obligations.
• To have a document that grants the use and exploitation and, where appropriate, the possession of all or part of the surface of the hubs, either under a concession, lease, loan, or any other title.
• To submit the investment plan that obtained the use, or exploitation and, where appropriate, the possession mentioned in the previous item.
• To be a resident for tax purposes of the hub where they carry out their production-economic activities.

The Ministry of Finance and Public Credit ("SHCP") will issue the certificate that will prove compliance with the established requirements, or an opinion of non-compliance, when requested to the competent authority of the state of Yucatan.

Tax benefits and administrative facilities

Tax Credit Income Tax (IT)

Taxpayers may apply said fiscal incentive, on the income derived from production-economic activities carried out at the hubs, and it consists of a tax credit that is applicable to offset the Income Tax payable in the fiscal year in question in the terms established in the Decree based on the following:

• Equivalent to 100% of the Income Tax payable during the three fiscal years starting on the year in which the taxpayer obtained the certificate.
• Equivalent to 50% during the three subsequent fiscal years or up to 90% if the taxpayer exceeds the minimum employment levels contemplated in the guidelines established for this case, which will be announced within ninety calendar days from the entry into force of this decree by the SHCP.

If the aforementioned credit is not applied in a fiscal year, the taxpayer loses the right to apply it later, considering that the right to apply the credit is personal and non-transferable as a result of a merger or a spin-off.

Provisional IT payments

It is established that taxpayers may apply the applicable percentage of the tax credit in the determination of the monthly provisional payments that must be submitted by the 17th day of the following month, provided that the amount of the provisional payments in the tax return of the year do not consider the tax credit that has been applied in said provisional payments.

Accelerated Deduction for IT

Any taxpayers eligible under this decree may apply an incentive consisting in the accelerated deduction of investments for a period of six fiscal years starting on the one in which they obtain the certificate, for 100% of the original amount of the investment in new fixed asset assets that they use at the hubs to carry out their production-economic activities, considering assets that are used for the first time in Mexico, as new assets for the purposes of this incentive.

It is important to note that this benefit will not be applicable for office furniture and equipment, cars, car armouring or any fixed asset not individually identifiable and where the accelerated deduction of investments may be made in the year in which they start to be used or, in the following year.

Value Added Tax (VAT)

A tax incentive is granted consisting of a tax credit equivalent to 100% of the VAT that must be paid for the sale of goods, the provision of independent services or the granting of the temporary use or enjoyment of goods, which will be applied against the tax that must be paid for the aforementioned activities, considering that said incentive may be applied for four years from the entry into force of the Decree, and that, if the tax credit is not applied in the tax return corresponding to the month in which the activities are carried out, the taxpayer will lose the right to apply it at a later date.

At Forvis Mazars we are at your service to support you with any questions or concerns.