Thursday, December 7, 2023

New purchasing scheme to avoid corruption; IVA to be halved near border

The incoming federal government will implement a centralized purchasing system to avoid corruption, Mexico’s future finance secretary said this week.

Carlos Urzúa said the new system would be similar to that used when buying products from retail giant Amazon and that all purchases would be controlled and monitored by the Secretariat of Finance.

He explained that when government personnel need to make a purchase, they will log on to a system which presents them with a range of options from suppliers that have already negotiated prices with the finance department.

Urzúa said the type of system to be introduced is already in place at the Institute of Social Security (IMSS), where it is used to buy medications.

The new system will “considerably” reduce corruption, the future finance secretary said.

Urzúa also said there is a proposal to establish a duty-free zone in Mexico’s northern border region where the value-added tax (IVA) would be halved from 16% to 8%.

He explained that a similar scheme existed in the 1990s but clarified that whereas at that time all of Baja California was included, the incoming government is only planning to implement the reduced tax rate in the more immediate border area, which includes cities such as Tijuana and Mexicali.

“It will help economic development at the border.”

He also said the new administration is considering the creation of a new mining fund to counteract negative effects that the industry has on communities near mining areas and that the agricultural secretariat would seek to provide incentives for greater production of key crops such as beans and corn by providing small-scale farmers with fertilizers rather than monetary aid.

In addition, Urzúa said there is a proposal to build a new 900-kilometer tourist railway between Cancún, Quintana Roo, and Palenque, Chiapas, that would serve as a trigger for economic growth and development in the south of the country.

(A newly-elected senator from Quintana Roo said today the train project would begin next year.)

All told, the new Andrés Manuel López Obrador-led administration will initially implement 38 strategic actions across all government secretariats, the prospective finance secretary said.

Source: El Financiero (sp), Animal Político (sp)

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