Unions Urge Thousands To Take To Mexico's Streets In Tax Protest

by Leroy Baker, Tax-News.com, Washington

14 September 2001

According to reports from the Mexican press, union leaders are this week expecting thousands of Mexicans to take to the streets of Mexico City to protest at President Vicente Fox's plans to impose taxes on food stuffs and medicines.

President Fox aims to raise $12 billion a year with his new tax proposals which will go towards combating poverty and boosting education. He wants the majority of the $12 billion to be generated from the new 15 per cent value added tax, and further revenue will be raised by reducing the bureaucratic burden involved in tax collection and by cutting the actual number of taxes.

The unions argue that the consumer taxes on food and medicines will have a severe impact on the country's poorest people and are eager to speak out loud against the government's plans. They intend to bring the streets of Mexico City to a standstill with a huge influx of protesters who will march to Congress where the proposals are currently being debated.

Fox, a former Coca-cola executive, has long said that he plans to fight Mexico's social problems with stable economic strength, rather than by handing money to the country's poor, as former Mexican governments have tended to do, thus enlarging the fiscal deficit and stoking inflation.

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