Introduction to the SHCP and Its “Healthy Taxes” Initiative
The Secretaría de Hacienda y Crédito Público (SHCP) has once again defended what they call “healthy taxes.” These taxes are expected to generate an additional 42 billion pesos in revenue for the upcoming fiscal year, which will be directed towards healthcare spending. Carlos Lerma Cotera, the subsecretary of Ingresos at SHCP, made these assertions during a meeting with senators from the Comisiones Unidas de Hacienda y Crédito Público y de Estudios Legislativos Primera.
Background on the SHCP and Its Relevance
The Secretaría de Hacienda y Crédito Público (SHCP) is a Mexican governmental body responsible for managing public finances, tax collection, and credit policies. Its decisions significantly impact the nation’s economy and public services, including healthcare.
The “Healthy Taxes” Initiative
In this context, the SHCP is advocating for “healthy taxes” targeting products that contribute to health issues, such as sugary drinks and tobacco. These taxes aim to generate additional revenue for healthcare without introducing new taxes but rather updating existing ones.
Details of the Tax Adjustments
Carlos Lerma Cotera explained that the tax adjustments include:
- An increase in the Impuesto Especial sobre Producción y Servicios (IEPS) for sugary drinks, both regular and light versions, from 1.6451 to 3.018 pesos per liter.
- A tax rate of 1.5 pesos per liter for “light” or “zero” sugary drinks.
- Continued taxation on tobacco products at an unspecified rate.
- A minor increase in taxes for video games and lottery tickets, generating around 1,000 million pesos.
Allocation of Additional Revenue to Healthcare
The additional 42 billion pesos generated from these tax adjustments will be allocated to the healthcare budget, which is projected to reach 966,662 billion pesos for the upcoming fiscal year. This budget already incorporates the extra income from these “healthy taxes.”
Addressing Concerns About Employment and Small Businesses
When questioned about the potential impact of these tax adjustments on employment in relevant industries and small businesses, Carlos Lerma Cotera dismissed such concerns.
“Historically, these products have shown relative inelasticity in consumption. Based on our 2013 imposition studies, consumers demonstrated little resistance to these taxes. Consumption decreased by less than 5%, with minimal impact on both producers and retailers of these beverages. We anticipate a similar trend, with no significant job losses.”
Key Questions and Answers
- What are “healthy taxes”? The SHCP’s “healthy taxes” initiative targets products that contribute to health issues, such as sugary drinks and tobacco, aiming to generate additional revenue for healthcare without introducing new taxes but rather updating existing ones.
- How much additional revenue is expected from these tax adjustments? An estimated 42 billion pesos will be generated, allocated to the healthcare budget for the upcoming fiscal year.
- Which products are subject to tax adjustments? Sugary drinks (both regular and light versions), tobacco products, video games, and lottery tickets are subject to tax adjustments.
- Will these tax adjustments negatively impact employment in relevant industries and small businesses? According to Carlos Lerma Cotera, there should be no significant job losses due to these tax adjustments.
