Mexico Unveils 2027 Economic Package Focused on Spending and Fiscal Discipline

-Editorial 

Mexican President Claudia Sheinbaum’s administration presented its proposed 2027 economic package, outlining increased spending on education, health, security and agriculture while projecting economic growth of 1.5% and 2.5%.

The proposal, submitted to Congress, does not include new taxes and calls for stronger enforcement against tax evasion as the government seeks to finance social programs, infrastructure projects and other priorities while gradually reducing the federal deficit.

Sheinbaum described the package during her morning news conference as a responsible approach to public finances.

“There are no new taxes,” Sheinbaum said. “It is simply about preventing tax evasion and continuing to guarantee the budget for the people.”

The administration also plans to continue fuel-price incentives that could be used if increases in international oil prices place upward pressure on gasoline and diesel prices.

Finance Secretary Édgar Amador Zamora said the package is based on five areas: economic growth, protection of social programs and public investment, stronger revenue collection, more efficient government spending and gradual deficit reduction.

The government projects economic growth of more than 2% as a central assumption of the package, while its broader forecast places 2027 growth between 1.5% and 2.5%.

Under the proposal, spending would increase 10.7% for education, 13% for science, 11.3% for health, 11.5% for security and 20.6% for agriculture, according to figures presented by the administration. Funding for federal welfare programs would also increase above inflation.

More than 1 trillion pesos would be allocated to the government’s social welfare programs. Officials said the proposed package would reduce the deficit to 3.9% of gross domestic product while keeping federal debt relatively stable through 2030.

Amador said budgetary revenue is projected to increase 3.9% in real terms, including a 5.9% increase in tax revenue and a 3.7% increase in nontax revenue. Total net spending is projected to rise 0.7% in real terms.

Antonio Martínez Dagnino, head of Mexico’s Tax Administration Service, or SAT, said the revenue proposal sent to Congress on Sept. 8 includes measures targeting companies that issue fraudulent invoices and other forms of tax evasion.

The proposal also includes controls related to income tax and the excise tax applied to gasoline and diesel, along with continuation of a tax regularization program and simplified requirements for micro and small businesses.

Martínez said tax revenue is expected to represent 15.4% of GDP in 2026. He said federal tax collections increased by 2.7 trillion pesos from 2019 through 2026 without a major tax overhaul, compared with an increase of 1.5 trillion pesos between 2013 and 2018, when a tax reform was implemented.

Jorge Alberto Mendoza Sánchez, director general of the National Bank of Public Works and Services, or Banobras, said the government projects 6.995 trillion pesos in tax and nontax revenue for 2027.

Of the proposed federal resources outlined by officials, approximately 1.1 trillion pesos would go toward welfare programs, while about 3.5 trillion pesos would cover pensions, interest, debt payments, and federal revenue-sharing payments to states.

The government also plans to review spending to reduce duplication and direct additional resources toward priority programs and projects.

The economic package is tied to a broader infrastructure investment plan totaling 5.7 trillion pesos from 2026 through 2030. More than half of that investment is expected to go toward energy projects, with additional spending planned for railways, highways, ports, water infrastructure, health facilities and housing.

Sheinbaum also discussed the finances of state-owned oil company Pemex, saying its liabilities have declined by more than $20 billion compared with previous levels. She contrasted the government’s approach with that of former President Enrique Peña Nieto, when Pemex debt increased substantially.

The proposed economic package must be considered by Congress as part of Mexico’s annual federal budget process. The administration said its goal is to maintain public investment and social spending while increasing revenue collection through enforcement and gradually reducing the government’s financing needs.