A ruling (Resolucion Miscel nea Fiscal or RMF), published in the Official Gazette of 21 June 1997, amended the tax tables for individuals for the second half of 1997, as indicated below.

Tax table for monthly withholding tax on employment income

Monthly taxable          Tax due on                Marginal rate on 
income (MXN)             lower limit (MXN)         excess (%)

up to 320.59                    0.00                3
320.60 -   2,720.87             9.66               10
2,720.88 -   4,781.62         249.65               17
4,781.63 -   5,558.48         599.99               25
5,558.49 -   6,654.98         793.96               32
6,654.99 -  21,155.21       1,144.18               34
over 21,155.22              6,075.17               35

Tax reduction (subsidio fiscal)

Individuals deriving employment income receive a reduction from their withholding tax liability. This is known as a "tax reduction" and is based on the taxpayer's taxable income and tax liability, taking the aggregate of a fixed amount and a certain percentage of the marginal tax due under the withholding tax table (see above), as shown in the following table:

Monthly taxable                                     Fixed amount + 
income (MXN)                                        percentage on 
                                                    marginal tax

up to 274.52                0.00                    50
274.53 -   2,329.97         4.11                    50
2,329.98 - 4,094.71       106.89                    50
4,094.72 - 4,759.94       256.88                    50
4,759.95 - 5,698.93       340.06                    50
5,698.94 - 11,493.94      490.27                    40
11,493.95 - 18,116.04   1,255.21                    30
18,116.05 - 22,987.87   1,930.66                    20
22,987.88 - 27,585.41   2,271.71                    10
over 27,585.42          2,432.61                     0

Abatement on monthly salaries (credito al salario mensual)

Employees receive a tax abatement, which differs for salaries and for other income treated as employment income. With respect to salaries, the tax abatement is the amount of Mexican nuevo pesos taken against the liability to the salary income tax after the tax reduction, calculated according to the following table (effective for the second half of 1997);

Monthly taxable                             Tax reduction 
income (MXN)                                on monthly salary (MXN)
up to 978.64                                225.18
978.65 - 1,440.98                           225.08
1,440.99 - 1,467.94                         225.08
1,467.95 - 1,921.29                         224.95
1,921.30 - 1,957.26                         217.28
1,957.27 - 2,094.27                         211.59
2,094.28 - 2,459.75                         211.59
2,459.76 - 2,609.68                         195.99
2,609.69 - 2,951.71                         179.74
2,951.72 - 3,443.68                         162.98
3,443.69 - 3,935.61                         140.25
3,935.62 - 4.084.13                         120.39
over 4,084.14                                98.37

With respect to other income treated as employment income, the tax reduction is equal to the general monthly reduction of MXN 98.37 (amount adjusted for the second half of 1997).

General credit (credito general)

Individuals receive a general allowance (periodically adjusted for inflation) from their income tax liability after the pertinent tax reduction. As adjusted for the second half of 1997, the general credit is (in MXN);

  • daily allowance: 3.24;
  • monthly allowance: 98.37;
  • quarterly allowance: 295.11; and
  • annual allowance: 1,180.44.

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

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