Background and Previous Programs
The Mexican government has proposed a capital repatriation program as part of the 2026 Economic Package, offering a preferential tax rate of 15% for funds that left the country and are now returning to Mexico. This is not the first time such a program has been implemented; in 2017, under President Enrique Peña Nieto’s administration, a similar capital repatriation program was launched with an 8% preferential tax rate.
Understanding Capital Repatriation
Iván Colín Mosquera, a member of the Fiscal Technical Commission of the College of Public Accountants of Mexico (CCPM), explains that capital repatriation involves bringing back resources that were previously taken out of the country.
“Sometimes, when someone takes capital out of a country like Mexico, it’s to move it to tax havens and avoid paying taxes on the generated gains in our country,” Colín Mosquera details.
He further explains that the proposed repatriation program by President Claudia Sheinbaum’s government aims to attract investments back to Mexico with a 15% preferential Impuesto sobre la Renta (ISR) rate.
Comparing Tax Rates and Incentives
Colín Mosquera notes that although the proposed 15% rate for 2026 is less attractive than the 8% rate in 2017, it still appeals to Mexicans because the personal income tax rate is 35%.
During Peña Nieto’s administration, the capital repatriation program resulted in the return of investments totaling 341,000 million pesos over nine months.
Colín Mosquera highlights that the proposed program has two conditions: investments must be legal, and when they return to Mexico, they should be invested in productive activities for at least three years.
Link to Plan Mexico
The capital repatriation program is being launched alongside Plan Mexico, the federal government’s comprehensive strategy to transform Mexico’s economy through industrialization, innovation, and social inclusion.
“It goes hand-in-hand with Plan Mexico, which seeks to attract resources to generate employment and dynamism in the country,” Colín Mosquera asserts.
Historical Context
Colín Mosquera recalls that in 2017, the capital repatriation program was initiated due to uncertainty surrounding Donald Trump’s presidency and his trade policies.
He points out the irony that this new repatriation capital program under President Sheinbaum comes in a year marked by uncertainty, similar to when Trump returned to the White House.
“All program details and rules will be published in decrees to be released in the Diario Oficial de la Federación (DOF),” Colín Mosquera concludes.
Clarification from SAT
Antonio Martínez Dagnino, head of the Servicio de Administración Tributaria (SAT), recently denied that the program is a “fiscal amnesty” or similar, emphasizing strict conditions regarding who can access the fiscal incentives.
Key Questions and Answers
- What is the proposed capital repatriation program? The Mexican government’s 2026 Economic Package includes a program to encourage the return of funds that were previously taken out of the country, offering a 15% preferential Impuesto sobre la Renta (ISR) rate.
- Why is this program being implemented again? This initiative aims to attract investments back to Mexico, contributing to the country’s economic transformation through Plan Mexico.
- What conditions must be met for the repatriated capital? Investments must be legal, and when they return to Mexico, they should be invested in productive activities for at least three years.
- How does this program relate to Plan Mexico? The capital repatriation program is part of Plan Mexico, which focuses on industrialization, innovation, and social inclusion to transform the Mexican economy.
- What is the significance of this program’s timing? The program’s launch in a year marked by uncertainty echoes the 2017 initiative during Donald Trump’s presidency, highlighting the ongoing need for such measures.
- What clarifications have been provided by the SAT? The SAT head, Antonio Martínez Dagnino, has clarified that the program is not a fiscal amnesty and emphasized strict conditions for accessing fiscal incentives.
