PRD Proposes Mexican Telecoms Sector Tax Cuts

The opposition Democratic Revolution Party (PRD) has proposed the removal of the 3% special tax on telecommunications services, alongside the value-added tax of 16%, in Mexico's 2012 budget, which is currently being debated in Mexican Congress. BMI believes the tax cuts could reduce the burden on low-income customers, through lowering prices. We also believe it can be of benefit to companies and the sector in general, by encouraging more investment in research and development. However, to achieve these positive effects, we stress the necessity of an improvement in the competitive landscape in the Mexican telecoms market.

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