Tax Competitiveness of the Maquiladora Industry slide image

Tax Competitiveness of the Maquiladora Industry

Final Results Countries Final results According to the results set out in table Table 1.8 1.8, which arose from the preceding calculation, countries selected for this analysis are: China, Brazil, Mexico, South Korea and Thailand. Since countries selected had values which approximate that of Mexico, it is worth clarifying that in addition to the countries selected, the study included Costa Rica because it aims to evaluate another country located in the same region as Mexico, with certain similar conditions even when the values assessed were not so similar. China 112% Brazil 70% Mexico 100% South Korea 99% Thailand 70% Malasia 67% Hungary 41% Costa Rica 50% Source: Prepared by KPMG in Mexico 2012 Estudio de Competitividad Fiscal Internacional de la Industria Maquiladora KPMG. 15 Methodology After selecting comparable markets we analyzed each of the promoting regimes available offered therein. From these selected countries, some have more than one regime for the various operations a company may engage in. As for promoting regimes, we only selected one for each country subject to assessment. The criteria used for this selection was to choose the one that most resembles the maquiladora regime in Mexico. The second criteria for this selection I was to pick the regime that offered the greatest possible benefits to participating entities. To facilitate the comparison, the analysis includes various tax groups used for grouping and classifying the applicable taxes of each country. ⚫ Indirect taxes (those taxing internal consumption) Foreign trade taxes • Other taxes • Local taxes The tax groups are as follows: Table 1.9 . Corporate taxes (those taxing the profits) Promoting regimes matrix Country Regime Mexico Maquiladora China Free zone Brazil Free trade zone South Korea Free trade zone Free zone Free zone Table 1.9 shows the regime selected by country. For further analysis details, table 1.10 shows a matrix that include each of the regimes by country and the treatment afforded to each tax group. In certain cases, there is more than one type of tax per group. In treatment is different within the group, detailed explanation will be provided for each. Thailand Costa Rical Source: Prepared by KPMG in Mexico 2012
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