RIO DE JANEIRO, BRAZIL – Mexican Economy Minister Tatiana Clouthier said on Tuesday, February 2nd, that she favored offering tax incentives to industry to spur investment as the government seeks to boost the economy after the ravages of the coronavirus pandemic.
While underscoring that she still needed to agree on measures with President Andres Manuel Lopez Obrador and the finance ministry, Clouthier said her personal view was that investment made by industry to modernize or innovate should be “tax deductible”.
Clouthier made the comments during an interview on Mexican broadcaster Canal Once. The minister did not go into more detail on her proposal, and noted that she did not know whether the government was currently ready to pursue such changes.
Mexico’s economy shrank by 8.5% in 2020, according to preliminary figures issued last week. Investment has been the Achilles’ heel of the economy under Lopez Obrador, whose economic policymaking has unsettled the private sector.
Clouthier, who has been in office for a month, was speaking only a day after Lopez Obrador sent a bill to Congress to change the rules in the electricity industry to help Mexico’s state-owned power utility, the Comisión Federal de Electricidad (CFE). That sparked a critical response from Mexico’s top business lobby, which said the president’s plan could hurt investment and was tantamount to “indirect expropriation.”