Background on the Mexican Federal Government’s Tax Initiatives
The Mexican federal government, through the Secretaría de Hacienda y Crédito Público (SHCP), has unveiled its Iniciativa de Ley de Ingresos de la Federación (ILIF) 2026. This proposal aims to generate a staggering 8.72 trillion pesos in revenue for the government by 2026, with taxes serving as the backbone of this ambitious plan.
Key Tax Increases in the ILIF 2026 Proposal
- Sugary Drinks: The Impuesto Especial sobre Producción y Servicios (IEPS) on sugary beverages will rise from 1.6451 pesos per liter to 3.0818 pesos per liter. This increase is expected to boost IEPS revenue from sugary drinks by approximately 66% in real terms, generating an estimated 75.29 billion pesos in 2025.
- Tobacco: The IEPS on cigarettes will increase from a 160% tax rate to 200%. This adjustment is projected to elevate IEPS revenue from tobacco products by 18% compared to 2025, resulting in an estimated 62.097 billion pesos in 2026.
- Violent Video Games: A new 8% IEPS will be introduced for video games with violent content. The government anticipates collecting 183 million pesos from this tax in the fiscal year 2026.
The Impact of the ILIF 2026 Proposal
The Impuesto Sobre la Renta (ISR) will continue to be the primary source of revenue for the federal government, with an estimated collection of 3.07 trillion pesos in 2026, marking a real growth of 3.8% compared to the previous year.
The Impuesto al Valor Agregado (IVA) is projected to generate 1.59 trillion pesos in 2026, solidifying its position as the second-largest revenue source for the federal government and marking a real growth of 4.9% compared to 2025.
The IEPS is expected to bring in 761.5 billion pesos in 2026, reflecting a real growth of 3.1% compared to the 2025 Ley de Ingresos de la Federación.
Lastly, the government anticipates petroleum revenues of 1.20 trillion pesos in 2026, representing a real growth of 1.9% compared to the previous year’s approval.
Key Questions and Answers
- What is the main goal of the ILIF 2026 proposal? The primary objective is to generate 8.72 trillion pesos in revenue for the Mexican federal government by 2026, with taxes serving as the foundation.
- Which taxes will see increases under the ILIF 2026 proposal? The IEPS on sugary beverages, cigarettes, and a new 8% IEPS on violent video games will all experience increases.
- How will these tax adjustments impact the federal government’s revenue? The ILIF 2026 proposal anticipates significant growth in revenue from the ISR, IVA, IEPS, and petroleum sources.
