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 "Green plants" arriving in Puebla
Puebla,- Automotive companies will invest US$250 million in. installing two plants to manufacture electric vehicles and energy supply systems, the State Government informed. A press release states that Ricardo Lorden, Phoenix Motorcars Director in Mexico and Latin America, informed that in a joint venture with Pristine International, vehicles with no pollutants emission will be produced in Puebla, which will generate 1 thousand 500 jobs.
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Enel purchases hydroelectric plants in Mexico
Mexico,- The Italian electricity company Enel will buy three hydroelectric. plants in Mexico, with a total capacity of 52 megawatts, from the US Investment Fund Conduit Partners, as part of their expansion plans in Latin America. "We are giving the final touches to an agreement for the three projects. It will be announced by the end of this year"
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Industrial production in Mexico up 0.4%
Mexico,- Mexico's industrial activity had a 0,4% year-to-year. expansion last September, the Ministry of the Treasury informed last Wednesday, the rise is quite below what was expected by the market. Analysts had forecasted a 2.58% expansion for industrial activity.
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Volvo de Mexico will export buses to USA and Europe
Guadalajara, - Prior to the inauguration of Expo. Transporte in Guadalajara, Volvo informed that in 2008 they will start exporting buses assembled in Mexico to the United States and some European countries. Noël Reculet, Volvo's Buses Division Director in Mexico, said that 20 buses assembled in the Company's plant located in Tultitlan, State of Mexico will be shipped for the first time to the USA.
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Bridgestone Firestone will invest US$90 million in Cuernavaca
Morelos,- Bridgestone Firestone., the tires manufacturer, will invest US$90 million in the expansion of its plant in Cuernavaca, Morelos. Ariel De Pascuali, Bridgestone Firestone Mexico President and CEO, said that the company will include an assembly line in its manufacturing process, which will allow manufacturing four thousand tires more in its factory located in Cuernavaca.
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Mimosa will invest US$40 million in coal extraction
Coahuila,- Minerales Monclova (Mimosa) informed. they will invest US$40 million to purchase a high technology coal exploitation system that will increase productivity and enhance yields exploitation. The Company informed in a press release that this equipment uses German technology, recently incorporated into mining all over the world.
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Lear will open a plant in Villa Ahumada
Chihuahua,- Lear, considered the second largest employer in Ciudad Juarez, is planning. to open a manufacturing plant in Villa Ahumada early next year. The new plant will immediately generate 400 jobs and will be devoted to the manufacture of car seats upholstery, said Susana Hermosillo Flores, who is in charge of Juarez Regional Offices of National Employment Service.
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Nissan celebrates export number two million
Mexico,- Nissan Mexicana celebrated its export number two million with a red Tiida Hatchback. shipped to Russia, after last September the Company had record sales abroad adding to 38 thousand 902 vehicles. Nissan informed in a press release that the automobile was shipped in Hoegh Trotter boat which sailed for Amsterdam, Netherlands and Newcastle, England, together one thousand 704 units more.
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ARTICLE OF THE WEEK
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| 2008 Mexican Tax Reforms Part 4 |
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By PriceWaterhouseCoopers |
 Tax consolidation
Annual calculation
The parent and its controlled subsidiaries are required to determine the Flat Tax obligation on a separate company basis, even if Income Tax returns are filed on a consolidated basis.
However, certain mechanics apply to consolidated groups to determine the separate company Income Tax to be credited against Flat Tax.
The subsidiary Income Tax which can be credited against its separate company Flat Tax, includes the Income Tax it remits to its parent corporation and the Income Tax it pays to the government on its own behalf, and the parent corporation will be able to credit the Income Tax it would have paid had it filed its Income Tax return on a separate company basis.
The parent and its controlled subsidiaries are each required to calculate and pay the Flat Tax by means of a tax return and must file such separate returns with the tax authorities based on the same due dates that apply for Income Tax purposes.
Advance tax payments
Controlled subsidiaries and the controlling parent corporation are each required to make monthly advance Flat Tax payments on account of the annual Flat Tax. For these purposes, the controlled subsidiaries will satisfy separate company advance tax obligations with the Income Tax paid to its parent corporation, as well as the Income Tax estimated tax payments such controlled subsidiary submitted to the government. On the other hand, the parent corporation will be obligated to cover its own Flat Tax advance payments on the basis of the tax that would have corresponded to the parent corporation if it filed on a separate company basis.
Non-profit entities
Non-profit entities authorized to receive deductible donations for Income Tax purposes, will not be subject to the Flat Tax for the income that they receive, as long as this income is destined for its activities in accordance with its bylaws, and such entities do not grant benefits to any persons on the basis of retained earnings or distributable surplus, except in cases when the benefit is granted to another authorized donee organization.
When non-profit entities determine a distributable surplus due to the omission of income, for purchases that were not made but improperly recorded as purchases, for nondeductible payments or for loans granted to their owners or members, the recipients will be Flat Tax taxpayers.
 The members of the non-profit organization that must recognize distributable surplus will be able to credit the Flat Tax against the Income Tax of the member, in the same proportion that such member’s distributable surplus bears to the surplus of all members, if such member recognizes its proportion of Flat Tax paid by the nonprofit organization. The credit applicable to non-resident members without a permanent establishment in Mexico cannot exceed the Income Tax.
The entity level Flat Tax cannot be credited by the members for the distributable surplus due to the omission of income, for purchases that were not made but improperly recorded as purchases, for non-deductible payments or for loans granted, if considered a surplus under the MITL.
Educational institutions organized as corporations or civil associations, but which do not have an authorization to receive deductible donations, must pay the Flat Tax. However, if these organizations receive such authorization for calendar year 2008, they will be able to request a refund of Flat Tax advance tax payments.
Trusts
The Fiduciary (Trustee) is required to determine and pay the Flat Tax. The beneficiaries will recognize the Flat Tax income of the trust as their own income, based on the proportions stipulated in the trust agreement and shall credit in the same proportion, the tax credits referred to in the law, and the advance tax payment obligations effectively paid by the trust.
The Fiduciary institution will file a return for its own activities and for each one of the trusts in which it acts as the fiduciary, for advance tax payment purposes.
 The beneficiary or the trust grantor, if applicable, which is not engaged in trade or business activities for Income Tax purposes but is engaged in activities subject to Flat Tax, such as leasing activities, will be able to fulfill the Flat Tax obligations on their own account whenever all beneficiaries and trust grantors formally approve this elective approach in writing to the fiduciary, and file this manifestation with the tax authorities by the 17th of following month in which it made this election.
The trusts created for the acquisition or construction of real property known as FIBRAS or Mexican Real Estate Investment Trusts, do not have the obligation to carry out Flat Tax advance payments.
Small taxpayer regime
The Flat Tax will be determined by the tax authority under the small taxpayer regime, by means of an imputation of the tax, based on the procedures to be established by the tax authorities. For this purpose, the tax authorities will credit against the Flat Tax obligation, the amount imputed as an Income Tax, and any other credits under the Flat Tax law, when applicable, relative to the month for which the tax applied; the difference will be the tax owed by the taxpayer.
Individuals paying taxes under the small taxpayer regime can consider that the Flat Tax is part of the imputed income arrangement relating to Income Tax, until the tax authorities compute a revised combined imputed tax.
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© 2007 PricewaterhouseCoopers. All rigths reserved “PricewaterhouseCoopers” refers to the network of PricewaterhouseCoopers International Limited members firms, each of
wich constitutes an autonomous and independent legal entity. * connectedthinking is a PricewaterhouseCoopers registered trademark.
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MEXICO'S WEEKLY HEADLINES
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| » Tata obtains contract of 200 million dollars |
| » Cummins Filtration concludes construction of plant in SLP |
| » VW will increase to investment in plants and equipment |
| » Barcelona invites to Mexican companies to enter Europe |
| » Mexico obtains this year Goal of the Millenium in poverty reduction
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