This afternoon, the Mexican Government announced the extension of the term established for the Repatriation Decree, from 19 July to 19 October 2017.

This brings the opportunity to those taxpayers who are still evaluating the application of the Decree in their particular case to decide and do so in the following months, to carry out the return of funds maintained abroad and access to the benefits granted by the Decree provided all other requirements established therein are duly met.

We will be happy to provide you with the required legal advice in order to implement this process.

In light of the imminent termination of the effectiveness period established in the Decree (July 19), an extension has been requested so that the Mexican tax authorities grant three additional months, which could allow taxpayers to apply the Decree until October 19, 2017, thus, to complete the return of capital until then and still have access to the reduced 8% income tax rate and other benefits.

This request was submitted yesterday (July 13) to the Ministry of Finance and Public Credit (SHCP) and the Tax Administration Service (SAT) by key banking/insurance groups within the Mexican financial sector: Banks of Mexico Association (Asociación de Bancos de México); Mexican Association of Stock Market Institutions (Asociación Mexicana de Instituciones Bursátiles); and the Mexican Association of Insurance Institutions (Asociación Mexicana de Instituciones de Seguros).

Naturally, the expectation from said request is a greater amount of repatriated funds, an increase of productive investment and employment generation in Mexico.

Regardless of the foregoing, to those taxpayers in the midst of applying the Decree, we recommend to continue in the process by taking into account the July 19 deadline.

We will keep you posted of any development in connection with said petition and reaction of the competent authorities.

This Alert is a supplement to Client Alert:

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