Sales Tax Refunds for Visitors to Mexico

Starting in June 2008, Mexico’s tax authorities will launch a scheme that enables visitors to reclaim the sales tax, known in Mexico as the Impuesto de Valor Agregado (IVA), currently a rate of 15%, where visitors arrive by air or, in 2009, by cruise ship.  The scheme is similar to those operated in Europe, where sales tax may be recouped by visitors when certain conditions are met.

Five of the country’s principal airports — Mexico City, Guadalajara, Los Cabos, Cancun and Puerto Vallarta — will be fitted-out with kiosks where the refunds will be processed.  Cruise ship passengers will need to wait until 2009 for the facility to be phased in at sea ports, along with the roll-out of kiosks at other major airports across Mexico.

To qualify for the refund of sales tax, you must have purchased goods (not services, e.g. meals, accommodation) totalling at least MX$1,200 pesos (approximately US$110) from approved stores using a credit or debit card issued outside of Mexico, or cash.  You must present your passport at the time of purchase and request a sales tax refund form from the store, in addition to your purchase receipt.

Once at the airport, you will need to present your passport, receipts and refund form(s) at the kiosk.  Upto MX$10,000 (about US$900) may be paid to you in cash over the counter; any excess will be refunded to your credit or debit card.

These schemes are useful if you plan to purchase a large number of items in Mexico, or if you want to purchase one or two high-value items.  The scheme offers an effective 15% discount on the purchase price.   Note that you are still responsible for any import duties in your home country, so if you purchase say, an expensive piece of jewelry, and claim back the sales tax in Mexico, you may still be liable to pay import duties and other taxes when you arrive home.

Some goods, like arts and crafts, are usually exempt from import taxes and duties, so if you buy a particularly expensive piece of craftwork from an approved store in Mexico, and there are no import duties to pay at home, you could enjoy a significant ‘discount’ using this scheme.  Check with your local aiport information desk for details about import duties and taxes on goods brought home from abroad.

Also See:

Mexico Entry Requirements 

Customs Procedures and Allowances