A ruling published in the Official Gazette of 3 February 1997 amended the tax tables for individuals for the first half of 1997, as indicated below.

Tax table for monthly withholding tax on employment income

Monthly taxable income(MXN) Tax due on lower limit(MXN) Marginal rate
                                                            on excess
                                                                  (%)
0.01 - 246.98                     0                                 3
246.99 - 2,096.24                 7.41                             10
2,096.25 - 3,683.95               192.33                           17
3,683.96 - 4,282.45               462.25                           25
4,282.46 - 5,127.24               600.86                           32
5,127.25 - 10,340.93              882.20                           33
10,340.94 - 16,298.73             2,602.71                         34
16,298.74 -                       4,628.35                         35

Tax reduction (subsidio fiscal)

Individuals who derive employment income are granted a reduction for their liability to withholding tax. The reduction is based on their taxable income and tax liability.

Monthly taxable income (MXN)Fixed amount(MXN)     + percentage of tax
                                                       resulting from
                                                    marginal rate (%)
0.01 - 246.98                0                            50
246.99 - 2,096.24            3.70                         50
2,096.25 - 3,683.95          96.17                        50
3.683.96 - 4,282.45          231.11                       50
4,282.46 - 5,127.24          305.95                       50
5,127.25 - 10,340.93         441.09                       40
10,340.94 - 16,298.73        1,129.29                     30
16,298.74 - 20,681.84        1,736.99                     20
20,681.85 - 24,818.18        2,043.82                     10
24,818.19 -                  2,188.58                      5

Abatement on monthly salaries (credito al salario mensual)

Employees receive a tax abatement which depends on whether the income consists of salaries or of other income treated as employment income. With respect to salaries, the tax abatement is a fixed amount of new pesos, based on the employee's salary. The abatement is calculated according to the table below (effective for the first half of 1997).

Monthly Taxable Income(MXN)        Lump sum on monthly salary(MXN)
0.01 - 880.47                           202.59
880.48 - 1,296.43                       202.50
1,296.44 - 1,320.68                     202.50
1,320.69 - 1,728.56                     202.38
1,728.57 - 1,760.92                     195.48
1,760.93 - 1,884.18                     190.36

1,884.19 - 2,213.00                     190.36
2,213.01 - 2,347.89                     176.33
2,347.90 - 2,655.61                     161.71
2,655.62 - 3,098.23                     146.63
3,098.24 - 3,540.81                     126.18
3,540.82 - 3,674.43                     108.31
3,674.44 -                               88.50

As to other income treated as employment income, the tax abatement is equal to the general monthly allowance of MXN 88.50 (amount adjusted for the first half of 1997).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

For further information contact Rodolfo Calvo, Galaz, Gomez, Morfin, Chavero, Yamazaki, Mexico City, Mexico on Fax: +52 5 281 5184