Mexico 🇲🇽

Mexico offers a range of incentives to attract both domestic and international film productions. Below is a detailed breakdown of the incentives:

1. Mexico Filming Incentives - VAT Exemption, EFICINE, and Local Incentives

Value Added Tax (VAT) Exemption:

• Film and video productions shot in Mexico, primarily intended for exploitation outside the country, are exempt from VAT.

EFICINE Tax Incentive:

• A fiscal credit is granted to income taxpayers who contribute to investment projects for domestic cinematographic production.

State and Local Incentives:

• Some states and cities offer additional incentives, such as lodging and transportation during location scouting, and discounts on services.

2. Film Incentives Breakdown

VAT Exemption:

• Rate: 0% VAT on qualifying expenses.
• Eligible Expenses:
  • All goods and services used in a production destined for export, including:
    • Wardrobe, makeup, location fees, props, set decoration.
    • Crew and equipment transportation, accommodation, film equipment rental.
    • Catering and animal rental.
• Requirements:
  • Expenses must be billed by a single company authorized by the Mexican tax authorities (SAT) prior to invoicing the project.

EFICINE Tax Incentive:

• Credit Amount: Equivalent to the amount contributed to domestic cinematographic projects, up to 10% of the income tax charged in the preceding fiscal year.
• Eligibility: Available to income taxpayers contributing to investment projects for domestic film production.
• Application: Requires prior authorization from the Mexican Film Commission (COMEFILM).

State and Local Incentives:

• Types of Support: May include lodging, transportation during location scouting, and discounts on services.
• Availability: Not always available and must be reviewed on a case-by-case basis.

3. Filming Incentives Terms and Conditions

VAT Exemption:

• Authorization: The company handling expenses must obtain authorization from the SAT before invoicing.
• Billing: All expenses must be billed by the authorized company.

EFICINE Tax Incentive:

• Contribution Limit: The incentive may not exceed 10% of the income tax charged in the fiscal year immediately preceding its application.
• Project Approval: Projects must be approved by COMEFILM.

State and Local Incentives:

• Negotiation: Incentives are negotiated on a case-by-case basis with local authorities.
• Availability: Subject to the discretion of state and city governments.

4. Governing Bodies for the Incentives

VAT Exemption:

• Administered by the Servicio de Administración Tributaria (SAT).

EFICINE Tax Incentive:

• Managed by the Mexican Film Commission (COMEFILM).

State and Local Incentives:

• Overseen by respective state and city film commissions or cultural departments.

5. Filming Incentive Application Process

VAT Exemption:

1. Authorization: Obtain authorization from the SAT for the company that will handle all production expenses.
2. Billing: Ensure all qualifying expenses are billed through the authorized company.
3. Compliance: Maintain records to demonstrate that the production is intended for exploitation outside Mexico.

EFICINE Tax Incentive:

1. Project Submission: Submit the film project to COMEFILM for approval.
2. Contribution: Make a financial contribution to the approved project.
3. Tax Credit Application: Apply the credit against the income tax payable for the fiscal year.

State and Local Incentives:

1. Inquiry: Contact local film commissions or cultural departments to inquire about available incentives.
2. Negotiation: Negotiate terms and obtain written agreements detailing the support to be provided.
3. Implementation: Coordinate with local authorities during production to utilize the agreed-upon incentives.

For detailed guidelines and application forms, consult the official websites of the SAT, COMEFILM, and local film commissions, or contact them directly for assistance.