Strengthening Mexico's fiscal policy

While Mexico has made significant progress in strengthening its fiscal policy over recent years, revenues remain too low to finance spending on infrastructure, education, health care, poverty reduction, family support and social protection. Although there is room for improvement on the efficiency of public spending, potential to raise additional tax revenues clearly exists, including by broadening the tax bases and adjusting the tax mix by focusing more on immovable property and environmentally related taxes. A more decisive fight against informality would improve tax collection and enhance the redistributive role of its tax system. This has to be accompanied by a strong agenda to increase the effectiveness and transparency of public spending and the fight against corruption.