MEXICO CITY – Mexican President Andres Manuel Lopez Obrador said on Monday that his two immediate predecessors used executive authority to write off more than $20 billion in taxes owed by large corporations.
“In two six-year terms large taxpayers were forgiven around 400 billion pesos ($20.9 billion). It’s a kind of white-collar looting that will be eliminated,” he said during his daily morning press conference.
Fulfilling a promise he made last week, the leader of the leftist Morena party signed a decree renouncing his authority as president to write off tax debts.
“It is about ending tax privileges and enforcing the constitution in letter and spirit,” Lopez Obrador said.
Margarita Rios-Fajart, director of Mexico’s SAT tax service, said at the press briefing that from 2007-2012, under then-President Felipe Calderon, 18,302 taxpaying entities benefited from 161.93 billion pesos ($8.45 billion) in tax forgiveness.
Both figures increased substantially during the 2012-2018 administration of Enrique Peña Nieto, who wrote off 238.97 billion pesos ($12.47 billion) in taxes owed by 135,228 filers.
The total amount of tax debt canceled over the 11 years was 400.9 billion pesos ($20.93 billion), according to the SAT.
And just 108 entities accounted for 54 percent of all the taxes forgiven. Of that number, 45 managed to get the records sealed.
The 2000-2006 presidency of Vicente Fox saw the advent of a “scheme of cancelations” that did not treat all taxpayers equitably, Rios-Fajart said.
Lopez Obrador said last Tuesday that executive tax forgiveness would not be extended to anyone during his 2018-2024 mandate.
“The tax cancelations are going to end and we are already completing the investigation of how thousands of millions of pesos in taxes were forgiven,” he said then.
The Organization for Economic Cooperation and Development (OECD), which comprises 36 mainly well-off countries, said in a 2017 report that the total amount of revenue taken in as taxes by the Mexican government was equivalent to 16.2 percent of the country’s gross domestic product.
The median tax take for the other 35 OECD member-states was 34.2 percent of GDP.