Senate says no to huge increase in tourist taxes after industry objections

The Senate has put the brakes on hefty hikes to two tourist taxes that were approved by the lower house of Congress.

The Chamber of Deputies last week approved a 388% increase to the DSM immigration services tax and a 58% hike to the DNR non-resident tax.

To enter the country by air, tourists would have been required to pay a total of 1,265 pesos (US $66), 98% more than they currently pay.

However, the Senate voted against the proposal following strong criticism of the increases by the tourist industry and business groups.

Senators with the ruling Morena party, which leads a coalition with majorities in both houses of Congress, said that approving the tax hikes would cause Mexico to lose competitiveness as a tourism destination.

They claimed that migrants who use air transportation to return to their countries of origin to visit their families would have been the most affected by the higher taxes.

Luis Alegre Salazar, a Morena deputy and president of the lower house tourism commission, said that experts weren’t consulted before the Chamber of Deputies passed the increases. He voted against the hikes.

One-fifth of all DSM and DNR tax revenue will go the National Immigration Institute in 2020 while the remainder will be used for investment in infrastructure.

Revenue from the DNR tax, approximately 6 billion pesos (US $314.6 million) annually, was previously allocated to tourism promotion.

But the federal government disbanded the Tourism Promotion Council and said that DNR revenue would help finance construction of the Maya Train on the Yucatán peninsula.

A record 41.4 million international tourists came to Mexico last year, 5.5% more than in 2017. Mexico is the seventh most visited country in the world.

Source: Infobae (sp)