Recently, the National Tax Administration of Mexico (SAT) issued an announcement announcing the upcoming revision of foreign trade rules to define low-cost tariff avoidance by e-commerce platforms and express companies in the process of importing clothing, electronic products, toys and other goods as smuggling and tax fraud. This initiative aims to counter illegal e-commerce platforms and cross-border logistics companies to exploit tariff regulatory vulnerabilities for tax evasion.

Low-cost tariffs will be severely hit.

According to SAT’s survey, recent growth in import trade through e-commerce platforms and cross-border logistics has been significant, but multiple platforms have exploited vulnerabilities in tariff regulations. Some of the sellers, e-commerce platforms and logistics companies involved in cross-border e-commerce are suspected of evading tariffs and failing to comply with tax regulations.

SAT noted that “failure to pay taxes and non-tariff regulations and restrictions could lead to smuggling and tax fraud.”“Al some logistics companies may be subjectively unaware, they are in fact involved in tax evasion and are therefore also responsible for cross-border trade tax evasion.”

While SAT has not clearly pointed out the identity of companies suspected of tax evasion, Mexican media generally believes that the statement is mainly aimed at Chinas cross-border e-commerce platform Shein and Temu.The two platforms have been active in the Mexican market in recent years and have become the object of focus for SAT.

Strong action in Mexico.

In November last year, SAT carried out a large-scale strike operation. At the time, SAT frequently carried out large-scale strike inspections to find suspicious goods directly seized, including containers shipped from the port to the warehouse, freight carriages, etc. SAT required documents (import receipts or electronic invoices) to prove that these goods were legally imported to Mexico, so that the goods could be dispatched. With this move, SAT combated the disguise of goods, low value of goods, small number of reports and other irregular ways.

Compliance issues to pay attention to exporting to Mexico

Mexico is a country with strong intellectual property rights, perfect customs and regulatory regulations and strict inspections. Local importers and exporters submit digital “value declarations” of goods through the Ventanilla Unica de Comercio Exterior (VUCEM) portal, simplifying customs procedures and effectively facilitating the process of declaring commercial invoices by generating an exclusive code called “COVE” (Comprobante de Valor Electrónico).

Mexican importers and exporters can send an electronic message via VUCEM to justify the various foreign trade regulations and non-tariff restrictions issued by several government agencies. Mexican customs inspection of imported goods is very strict, especially electric, powder solid, textiles, footwear and other goods, requires inspection of the corresponding import qualifications, customs documents are relatively complex, and the inspection process is relatively difficult.

In addition, Mexico is one of the countries with the most anti-dumping investigations in China.In March this year, the Mexican Textile, Clothing and Shoe Industry Association launched a joint protest against Chinese e-commerce platforms, demanding that government agencies strengthen regulation of such cross-border trading platforms.

Mexicos latest tariff policy has a profound impact

In April, Mexico imposed temporary import duties of 5% to 50% on steel, aluminum, textiles, clothing, footwear, wood, plastics and their products, chemicals, paper and cardboard, ceramic products, glass and its manufactured products, electrical equipment, transportation equipment, instruments, furniture and other 544 goods.

This series of policies indicates that Mexico is increasing its regulatory efforts on imported goods, especially against tax evasion. Foreign trade companies must pay great attention to this change when exporting to Mexico to ensure compliance operations and avoid being punished for breaches.

Recommendations for foreign trade companies

1. Declaration of complianceDeclaration strictly in accordance with relevant Mexican regulations, ensure that all import documents are complete and accurate, and avoid non-compliance such as low-cost tariffs.
2. Understand the regulations.A deeper understanding of Mexico’s customs regulations and tax requirements, especially for electronic products, clothing, toys and other regulatory goods.
3. Compliance logistics companiesChoose a reputable and compliant logistics company to ensure the legality of goods transportation and clearance process.
4. Positive CommunicationStay in good communication with local business partners and government agencies in Mexico to get up-to-date policy and regulatory information in a timely manner to ensure that business operations meet the latest requirements.