Covid - 19 in Mexico

In April’s 23th. edition of the Federal Official Gazette, the Decree through which several provisions of the Federal Labor Law, Social Security Law, Law on the Institute of National Housing Fund for the Workers, Federal Tax Code, Income Tax Law, Value Added Tax Law and others related to outsourcing of labor approved by the Senate on April 20, 2021 was published. This way, except for certain provisions, this reform came into effect on the following day, after having been subject to rigorous scrutiny among the sectors involved under a novel open parliament exercise since last December, following the request of the business and workers sectors, to evaluate the collateral effects, mainly with regards to the obligation companies have to share profits with their employees. It is worth pointing out that the reforms to the Federal Tax Code, Income Tax Law and Value Added Tax Law will come into effect on August 1st., 2021. In this sense, in the document available for download, we mention the most transcendental changes, some of them previously mentioned in our Bulletin issued on April 5, 2021. REFORM ON OUTSOURCING OF LABOR Undoubtedly, this reform will bring important repercussions in the companies’ operating and business sphere, as well as in its relations with the suppliers of goods and services, workers, unions and government agencies; therefore, it will be necessary to conduct a comprehensive analysis in order to identify any need to adapt to these new provisions and avoid negative effects.

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In SKATT, we are at your service for any doubt, as well as to explore the legal options that may be available to successfully handle what is certainly a historic reform with important repercussions for companies in Mexico.

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