Our partner Oscar López Velarde and associate Samantha Oseguera analyze the growing uncertainty around Mexico’s 4.9% withholding tax on interest payments to US banks, a cornerstone of cross-border credit operations. Shifting political dynamics—Trump's re-election and Sheinbaum's presidency—are straining diplomatic relations and raising concerns over the stability of tax rates and treaties.
Key insights include:
- The 4.9% rate has historically incentivized US-Mexico financial transactions but is now under scrutiny.
- Political tensions may lead to revising or eliminating this rate, impacting cross-border lending.
- Financial institutions face increased regulatory uncertainty, leading to hesitation in finalizing credit deals.
This evolving landscape could significantly affect the profitability and structure of cross-border credit operations.
We invite you to read the full article to learn more about this topic.
If you have any questions, please contact our Tax experts (see details below).
