With Mexico’s New Tax Code in Place, Generics Stand to Benefit
13 January 2014 A new tax law will impact growers, and therefore agrochemical distributors in Mexico this year, Omar Olmos, regional director of Kleffmann LATAM Norte said. According to the new scheme which came into effect Jan. 1, growers will be taxed according to the chemical’s toxicity level:
- Categories 1 and 2 (red and yellow bands) will pay 4.5%
- Category 3 (blue band) will pay 3.5%
- Category 4 (green band) will pay 3%
| Product | Segment | Toxicity |
| Lorsban* 480 | Insecticide | Blue band = 3.5% |
| Gramoxone | Herbicide | Blue band = 3.5% |
| Hierbamina | Herbicide | Blue band = 3.5% |
| Arrivo 200 CE | Insecticide | Blue band = 3.5% |
| Faena (Roundup) |
Herbicide | Green band = 3% |
| Inex-a | Adjuvant | Green band = 3% |
| Esteron 47 M | Herbicide | Blue band = 3.5% |
| Surfacid | Adjuvant | Green band = 3% |
| Gesaprim Calibre 90 GDA | Herbicide | Green band = 3% |
| Furadan 300 TS | Insecticide | Yellow Band = 4.5% |
Another change is the loss of the “special régime” which allowed growers to deduct up to 14% of their income. Now, they will have to pay a full 32% income tax, Olmos told FCI, adding, “Since this year will mean ‘adjustments’ due to the tax reform, we can expect the growth of the main players in the market to be moderate. However, it is important to keep the generic brands under observation, because they now have the necessary conditions to quickly gain market share.”
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