(OFFICIAL)-INTERVIEW-Mexico attracts 3 bln pesos through tax repatriation plan


Reuters

CORRECTED-(OFFICIAL)-INTERVIEW-Mexico attracts 3 bln pesos through tax repatriation plan


(Corrects figure in 10th paragraph to 1.6 billion pesos from
6.6 billion)
    MEXICO CITY, April 18 (Reuters) - Mexico has attracted
nearly 3 billion pesos ($161.50 million) in investment into the
country through a tax repatriation plan, a tax official said, as
U.S. President Donald Trump has floated policies that could hit
growth in Latin America's No. 2 economy.
    In a bid to boost Mexico's paltry tax take and attract fresh
capital, Mexican President Enrique Pena Nieto unveiled plans in
January to offer an 8 percent tax on earnings from investments
that Mexicans bring home.
    The program, which runs through June, has generated about
215 million pesos in tax revenue through April 11 on the
returned capital, according to Lizandro Nunez, the tax
collection manager at Mexican tax authority SAT.
    "We think we will receive much greater resources than what
we have already received," through the end of the program, he
said in an interview late on Monday, noting that some of the
rules have just recently been defined.
    Nunez said it was still too soon to rate the repatriation as
a success or failure, adding that the government did not set a
tax collection goal.
    But analysts have expressed skepticism over the plan,
arguing that it is risky to invest in Mexico right now.
    Mexico's peso was hammered by Trump, who has threatened to
scrap a free trade deal with the country and levy a tax on
imports into the United States. He has also pressured American
companies like air-conditioning firm Carrier Corp into scaling
back investment plans in the country. [nL1N1DV01G]
    The peso has recovered, but Nunez emphasized that qualifying
investments include instruments denominated in foreign
currencies.
    "That eliminates risk," Nunez said.
    A repatriation program last year saw 1.6 billion pesos
repatriated, Nunez added.
    The 8 percent tax, which is well below Mexico's top income
tax rate of 35 percent, must be paid 15 days after money is
transferred. Repatriated funds must be channeled into
investments like fixed assets and property for at least two
years.
    In January, the government said the powerful CCE business
lobby estimated the plan could yield $10 billion in investment.
[nL1N1F71RH]
($1 = 18.5760 Mexican pesos)

 (Reporting by Alexandra Alper, Additional Reporting by Sharay
Angulo; Editing by Lisa Shumaker)
 ((mitra.taj@thomsonreuters.com; +52 1 55-5414-6235; Reuters
Messaging: mitra.taj.thomsonreuters.com@reuters.net))

Keywords: MEXICO TAX/ (INTERVIEW, CORRECTED)



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