VENICE, July 11 - Mexican Finance Minister Arturo
Herrera told Reuters that the global deal to revamp taxation of
multinational companies should easily win approval from Mexico's
Congress because it will expand the country's revenue base, but
consideration will likely wait until September 2022.
Herrera said in an interview on the sidelines of this
weekend's G20 finance leaders meeting in Venice, Italy that the
OECD tax deal was a "no brainer" for Mexico.
The deal, which establishes a global minimum corporate tax
of at least 15% and allows the largest multinational firms to be
taxed in countries where they sell products and services, was
formally endorsed by the G20 ministers on Saturday.
"I think for us, this is something that should go smoothly,
because it's going to be a net inflow of taxes," Herrera said of
legislative approval. "And these are taxes related to economic
activity that happen in the country. But currently, because of
profit shifting, our base suffers."
A final agreement on the global minimum tax is expected in
October, which would miss by a month Mexico's annual amendments
to its tax laws. This means that Mexico's Congress would likely
ratify it in September 2022, Herrera said.
U.S. Treasury Secretary Janet Yellen said on Sunday that
final details of the reallocation of taxing rights for large
companies, including technology giants such as Google, Facebook
and Amazon.com, could take longer to complete than the global
minimum tax, possibly by the spring of 2022.
If not delayed further, the reallocation portion could still
meet a September 2022 timeframe for Mexico.
G20 finance leaders discussed ways to increase access to
vaccines but announced no major new commitments in Venice.
. They also expressed concern about the spread of
new COVID-19 variants dealing a setback to broad economic
Herrera said that there may need to be a new multilateral
option for developing countries to receive more vaccines besides
the COVAX vaccine fair distribution scheme co-led by the World
Health Organization, which he called a disappointment.
Out of 254 million vaccine doses procured by Mexico, more
than enough to vaccinate Mexico's 126 million population, the
largest share was through COVAX. Herrera had high hopes for a
smooth delivery, but until a month ago, "the vast majority of
the vaccines received were non-COVAX," he said, adding that
these came directly coming directly from AstraZeneca,
Pfizer-BioNTech, CanSino, Sputnik and Johnson & Johnson.
"COVAX is a great idea, but it has been poorly implemented,"
Herrera, who is soon leaving Mexico's Finance Ministry to
become the country's central bank chief, also told Reuters that
he believes inflation is under control in Mexico without lasting
"Most of the information makes us think that at least right
now, some of the optics we are seeing are temporary, or related
to the pandemic," he said referring to supply bottlenecks and
shifts in demand that has driven up prices for specific goods
such as laptop computers.
"We need to watch it, but we are reasonably optimistic that
most of the movements in prices are going to be temporary."
(Reporting by David Lawder)