The administration of President Enrique Peña Nieto completed the legislative phase of its structural reforms in August 2014 and implementation is ongoing. Perhaps the most important changes for foreign investors are the tax reforms, which notably introduce a new tax on stock market gains and a tax on dividend payments.

“ will generate a large number of opportunities and growth in financing and IPOs, directly impacting growth in domestic and foreign investments through the Mexican Stock Exchange,” says Adrian Garza, managing director and head of securities services at Banco Santander México.

There is a new 10% tax on dividends received from foreign companies. This is the change that will cause the greatest additional administrative burden for individuals, especially international assignees, according to PwC. There is also a new 10% tax on dividends received from Mexican corporations, which must be withheld by the Mexican corporation.

The 2014 Mexican tax reform also repealed the capital gains exemption for holdings of less than 10% of the company applicable to foreign residents in relation to the sale of publicly-traded shares. There is now a 10% tax on net gains realised on the sale of Mexican or foreign shares in the Mexican stock exchange.

The Mexican government promised, in February 2014, not to make further changes to the tax rules until at least 2018.