This past week Mexican businessmen joined together at the annual Mexican Business Summit to discuss the latest business trends in this Central American country.
In a speech delivered by President Enrique Peña Nieto, the message coming from the leader was ‘if fiscal reform were not hurting it would be a sign that the bites aren’t deep enough.’
When Nieto came to power last September the Mexican business community felt it was on a honeymoon with its new leader. But the love affair is in a cooling stage now as the President seems to be behind a new tax-bill which was approved by Mexico’s lower house on October 18.
Mexican businessmen argue that the new fiscal reforms such as a junk-food and soft-drink tax will hurt business or deter investment. Whether their arguments will persuade the Senate is yet to be seen; the vote is scheduled for October 31. But a new argument is arising from business in their struggle against reform: they claim that the tax reforms show the government, which came to power a year ago come December on the promise of balancing the budget, has become corrupt.
What the tax reforms really signify, they say, is that the love affair with fiscal responsibility that has restricted Mexican economic policy ever since the peso crisis of 1994 may be just about over.