What products and services are exempt from VAT in Mexico?
Mexico's VAT is a tax that all taxpayers pay; however, there are products and services that are exempt. Find out what they are.
In Mexico, several products and services are exempt from Value Added Tax (VAT), to encourage the consumption of certain products and the production of certain sectors, but also to guarantee access to certain rights.
The products that are best known for having a 0% tax rate on their consumption are food and medicines. But they are not the only ones and, in fact, for the 2022 tax miscellaneous, the Executive proposed to incorporate pet food, sanitary napkins, tampons, and menstrual cups as VAT exempt goods.
Which products are currently exempt from VAT?
In general, VAT is a levy of up to 16% on the value of goods that consumers pay each time they purchase a product. However, the following items are exempt from this tax:
Books, magazines, and newspapers.
Sale of non-industrialized animals and vegetables.
Patent medicines.
Jewelry, gold, goldwork, ornamental and artistic pieces.
Greenhouses for crops.
Processed pet food.
Chewing gum.
Flavorings, microencapsulated, and food additives.
Products intended for food, except for juices and nectars.
Sale of ice and non-carbonated and non-compounded water, in containers of less than 10 liters.
Tractors for agricultural implements.
Caviar, smoked salmon, and elvers.
Fertilizer.
Ixtle, lechuguilla and palm.
Herbicides, pesticides, and fungicides intended for agriculture or livestock.
What type of services are exempt from VAT?
Agriculture or livestock.
Pasteurization of milk.
Grain milling (corn, wheat, among others).
Hydroponic greenhouses.
Cotton ginning.
Cattle and poultry slaughtering.
