Coparmex, the umbrella employers' confederation, proposes reducing the general IVA rate to 10% (like the government) and extending it to food and medicine, but at the lower rate of 5%.
The senate has suggested raising fiscal revenues, not via new or higher taxation but by strengthening tax collection and curbing evasion, reckoned to be equivalent to half current tax receipts. Tax receipts in Mexico amount to 11% of GDP, one of the lowest rates in the hemisphere.
GROWTH OUTLOOK | Farming & building are driving forces. September economic activity figures continue to show a pattern of weak overall growth, at 1.2% above the same month of 2002. Two sectors, agriculture and construction, showed more than moderate year-on-year expansion (7.6% and 3.9%, respectively), but this was offset by a 1.8% decline in manufacturing.
EMPLOYMENT | Jobless rate remains high. The open unemployment rate in Mexico's 32 biggest cities was 3.63% in October, slightly down from the 3.87% measured the previous month. The countrywide rate in October was 2.8%. The official open unemployment rate excludes anyone who worked even a single hour in the week the survey was conducted. The broader rate of `critical employment conditions' was 10.32% in October.
PUBLIC DEBT | Domestic debt hits record high. At end-September Mexico's domestic public debt reached a record M$851.2bn (US$77.8bn), or 13.4% of GDP — almost one percentage point more than at the end of last year. The external public debt at end-September totalled US$75.9bn, up only US$6.2m since end-2002.
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