Mexico has a revenue problem. It's had a revenue problem for decades. But, due to its dependence on oil revenue (over 38% of its federal budget), and the high price of this commodity, it has been able to avoid an overhaul of its tax code that would lead to higher government receipts.
Currently, Mexico collects about 10% of its GDP in taxes.
(For the sake of comparison, the US (federal + state + municipal) collects over 32% of GDP in taxes, and progressive Western European nations bring in as much as 50% of GDP in taxes.)
Six years ago, when President Zedillo left office, Mexico took in about 11% of GDP. Then, when Conservative Fox acceded to the presidency, he proceeded to slash the top marginal rate (was 35%, now 28%), and promised everyone who would listen (think Heritage Foundation and other WingNuts) that the tax cuts would pay for themselves, that, thanks to a lower top marginal rate, tax receipts as a % of GDP, would climb.
Instead, Mexico lost 10% of its tax tax, which leads us to the present predicament.
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