IMMEX Program: How to Defer Taxes on Mexico Imports

Interview with Isis Gomez, VP of International Trade and Compliance for Co-Production International.
Isis has worked in the industry for fifteen years and holds a bachelor’s degree in International Trade and Customs

from Instituto Tecnológico de Baja California (TBC). She assists our partners in Mexico with import/export compliance and customs processes, including minimizing or deferring VAT and duties costs for IMMEX certified companies under CPI’s shelter program. Isis is Six Sigma Green Belt Certified.

Apart from the proximity advantages of manufacturing in Mexico, additional cost savings and maquiladora tax benefits also exist for foreign companies that operate in Mexico with VAT exemptions (IVA TAX Mexico) and tariff free import-export under the United States-Mexico-Canada Agreement (USMCA, formerly North American Free Trade Agreement NAFTA).

Mexico’s IMMEX program was created to promote foreign investment, encourage exports, stimulate manufacturing and boost employment.

Import/Export Costs in Mexico: Duties and VAT

Let’s get right down to it, what is the IMMEX Maquiladora program in Mexico?

The IMMEX program allows companies with the VAT Certification defer the 16% VAT on the temporarily imported raw materials and components to Mexico as long as they are transformed into finished goods or processed, and then exported within 18 months (in most cases). IMMEX also allows you to consolidate import declarations on a weekly basis. Think of it this way, the IMMEX Mexico Program overseas the import process, the VAT Certification is what eliminates the 16% VAT (Impuesto al Valor Agregado).

What are the IMMEX Program requirements?

Here are some of the main requirements to be approved as an IMMEX Company. Remember, we help you handle all of these details under our Shelter Services in Mexico.

• To be a legal entity in Mexico with the obligation to pay income tax (ISR)
• To export US$500,000 in a one-year period
• To respect the terms under the law (Article 108 Mexico Customs Law & Article 4 IMMEX Decree)
• To have the good and services in the registered & approved addresses
• To use the goods solely for what they have been approved

Sounds easy enough – Can any foreign company take advantage of the IMMEX Program?

Not so fast. Before a company can take advantage IMMEX Program, it must meet certain requirements, including obtaining the VAT Certification and being approved by the Mexican government.

Is the IMMEX Program Authorization and VAT Certification process difficult?

This process can take up to 9 months or more and should be factored at the beginning stages of your ramp-up so you aren’t caught short once you begin your import/export activities in Mexico. The IMMEX Program and the VAT Certification are just two of the benefits CPI’s Maquiladora Shelter Program. We already have the Certification and IMMEX Program, avoiding months of waiting, allowing you to focus on more important things like training personnel and getting your production floor ready to go online.
 

Where do I go from here?

Just ask – we love questions! Major Manufacturing Industries in Mexico, industrial real estate, labor law, strategic locations and the costs of setting up manufacturing operations in Mexico.

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