Executive summary

The Federal Executive submitted the 2027 Economic Package to Congress on September 8, 2026. The proposal combines fiscal consolidation with higher tax collection, mainly through income tax changes, controls on deductions and NOLs, and investment incentives. The package does not generally propose new taxes; the measures remain subject to the legislative process.

KEY PROPOSED INCOME TAX CHANGES

1. Control on deductions

For general-regime legal entities with revenue above MXN 50 million, a minimum taxable profit of 3.33% is proposed: where deductions exceed 96.67% of taxable revenue, only that percentage would be deductible; where deductions are below that threshold, only 99% would be deductible. Deferred deductions could be used over up to 20 years. The limitation would not apply to PTU.

2. Net operating losses

The use of prior-year NOLs would be limited to 50% of taxable profit for both provisional income tax payments and the annual return. The carryforward period would increase from 10 to 20 years. In practice, applying the limitation to provisional payments may accelerate income tax cash outflows during the year.

Proposed exceptions

Exceptions would include, among others, taxpayers with less than five years since RFC registration; coordinated and primary-sector taxpayers; those applying immediate deductions; maquila operations; taxpayers in bankruptcy proceedings; and certain merger or spin-off cases.

3. Net interest expense

The net interest deduction limitation would decrease from 30% to 20% of adjusted taxable income.

4. Tax Installments

For 2027, an adjustment to the profit coefficient used to determine provisional income tax payments is proposed. The coefficient would be multiplied by 1.0658 when deductions are equal to or below 96.67% of taxable income, and by 2.6162 when deductions exceed such percentage.

OTHER PROPOSED INCOME TAX CHANGES

Foreign payments

Deductions for transactions with foreign residents would be recognized in the fiscal year in which consideration is actually paid and the related withholding tax is remitted. Withholding would follow the earliest of enforceability, accrual or payment.

Service and lease prepayments

Prepayments would be deductible as the service or use/enjoyment is received or accrued. Multi-year prepayments would be allocated to the corresponding fiscal periods.

CUFIN, CUCA and debt capitalization

CUFIN: certain expenses that fail tax requirements would be included among non-deductible items for UFIN purposes. CUCA: accrued unpaid interest and VAT arising from debt capitalization would not increase share tax basis or CUCA.

In-kind contributions and accounting losses

Contributions through receivables, collection rights or credit instruments would increase tax basis and CUCA only when realized and to the extent cash is collected. The amortization of accounting losses would also be treated as a paid reimbursement for certain purposes and would reduce CUCA.

Optional Regime for Groups of Companies

The Optional Regime for Groups of Companies would be eliminated. Existing groups would be required to exit beginning January 1, 2027 and pay deferred income tax under the final transitional rules.

Corporate documentation and governance

The proposed changes involving debt capitalizations, in-kind contributions, CUCA movements, accounting-loss amortizations, reorganizations and the exit from the Optional Group Regime increase the importance of consistency among shareholder or board resolutions, agreements, accounting records and tax support. Companies should verify that the legal form and corporate documentation of each transaction align with the tax treatment applied.

Initial public offerings (IPO)

A preferential 10% income tax rate is proposed for gains on share dispositions made in connection with an IPO, subject to specific requirements.

INCENTIVES AND RESICO

Plan México: productive investment

The Income Tax Law would incorporate immediate deductions for new fixed assets acquired from 2027 through September 2030, with percentages varying by asset and activity, subject to requirements.

Training and innovation

An additional 25% deduction is proposed on the increase in eligible training and innovation expenses compared with the average of the prior three fiscal years.

RESICO - Individuals

The annual threshold would increase from MXN 3.5 million to MXN 5 million; the rate table would be adjusted to maintain the maximum 2.5% rate; re-entry would be facilitated for taxpayers that regularize their obligations; and the exempt threshold for certain primary-sector activities would rise from MXN 900,000 to MXN 1 million. A simplified 7% VAT option on taxable consideration actually collected, without input VAT credits, is also proposed.

RESICO - Legal entities

The threshold would increase from MXN 35 million to MXN 50 million; the regime would become optional; re-entry would be facilitated for companies that again meet the requirements; investment deduction percentages would be expanded and transition mechanisms introduced. The simplified 7% VAT option is also proposed.

REVENUE LAW, DIGITAL PLATFORMS, VAT AND IEPS

Interest withholding

The annual provisional income tax withholding rate on interest is proposed at 0.68% for 2027, compared with 0.90% in 2026.

Digital platforms - Income tax

The 2027 Federal Revenue Law proposal maintains the withholding regime applicable to digital intermediation platforms. Under the existing framework intended to continue, legal entities selling goods or providing services through such platforms are subject to 2.5% income tax withholding on gross income, with no deductions; where the taxpayer does not provide an RFC, the rate is 20%. The tax withheld may be credited against provisional or annual income tax.

0% VAT - books, newspapers and magazines

The proposal would replace the income tax incentive equal to 8% of acquisition cost with a 0% VAT rate on sales, subject to the requirement that 90% of revenue arise from such activity.

Digital platforms - VAT

The VAT withholding framework for digital intermediaries is also maintained. When the platform collects the price and VAT on behalf of the supplier, withholding from legal entities is made under Article 18-J of the VAT Law (generally 50% of the VAT charged). A 100% VAT withholding applies, among other cases, to foreign residents without a permanent establishment in Mexico selling goods in Mexico and where transaction proceeds are deposited into bank or deposit accounts located abroad.

Surcharges and installment payments

Monthly rates would remain at 1.38% on outstanding balances and 2.07% for delinquency. Installment rates would be 1.42% up to 12 months; 1.63% for more than 12 and up to 24 months; and 1.97% for longer terms or deferred payment.

Toll-road incentive

The incentive for certain transportation taxpayers would remain, but the annual revenue threshold to qualify would be reduced from MXN 300 million to MXN 250 million.

IEPS - fuel marketers

Gasoline and diesel marketers other than manufacturers, producers and importers would compare monthly liters sold against liters purchased. Any positive difference would be subject to IEPS without incentives, reductions or credits, based on Federal Tax Code volumetric controls.

LEGISLATIVE PROCESS

Legislative process - key dates

September 8, 2026: submission of the 2027 Economic Package to Congress. October 20, 2026: deadline for the Chamber of Deputies to approve the Federal Revenue Law. October 31, 2026: deadline for Senate approval of the Federal Revenue Law. November 15, 2026: deadline for the Chamber of Deputies to approve the Federal Expenditure Budget. The Revenue Law and the Budget must be published in the Official Gazette no later than 20 calendar days after approval. Tax initiatives may change during committee and floor discussions and should not be treated as final until approved and published.

Conclusion

The package would materially change the determination of the income tax base while expanding incentives and options for certain taxpayers. The impact will vary by company; early tax modeling and review of the operating structure will be critical.

J.A. DEL RÍO offers a wide array of specialized consulting services to assist you with these and other matters, in order to ensure that your project complies with the applicable characteristics  contained in this agreement.

If you have any questions, J.A. DEL RÍO can provide you with our experts to advise in matters concerning compliance with your legal and tax obligations. Once again, please let us know if we may be of any further assistance to you at: contacto@jadelrio.com.