Mexico cuts tax to curb record high petrol prices
The average price of Mexico's regular gasoline (87-92 octane), locally known as Magna, hit a record high of 19.77 pesos (US$1.05) per liter last month, according to national energy regulatory commission CRE.
The price of Magna in late March, which represents approximately 85% of the national gasoline market, was 12.7% higher than the same period last year, compared to inflation in the country which is estimated at 4%.
While much of the country is seeing prices between 17-20 pesos per liter, many of Mexico’s most populated states are facing prices of up to 21 pesos per liter. Among them are México, Jalisco, Guanajuato, Nuevo León, and Michoacán.
Meanwhile, the average price of Premium and Diesel in March was 20.81 pesos and 21.46 pesos, respectively. While Premium saw an 8.8% uptick from last year, Diesel increased 15.1%.
To help control the prices, the Mexican Government - in March - resumed a fiscal stimulus which reduces the production and services tax (IEPS) on Magna.
While it started off with a tax break of 1.95% (.09 pesos) in early March, it reached 31.1% of IEPS (1.5 pesos) by the end of the month. The last time this stimulus was implemented was November 30, 2018.