Mexico announced the imposition of tariffs on apparel and textile products as a measure to combat technical smuggling.
The tariffs will be 35% for 121 tariff items corresponding to apparel products and 15% for 17 tariff items related to textile products.
On Thursday morning, Marcelo Ebrard, Secretary of Economy, detailed this measure at the National Palace, ahead of a decree to be published in the afternoon in the Official Gazette of the Federation (DOF).
Tariffs on apparel and textile products
These import taxes are an additional measure to the one taken on April 22, 2024. On that date, the Tariff of the Law of General Import and Export Taxes was reformed, establishing temporary tariffs, ranging from 5% to 50%, on the import of goods related to steel, aluminum, textiles, clothing, footwear, wood, plastic and its manufactures, among others.
Ebrard explained that Mexico allows the import of textile products without payment of taxes or tariffs to be incorporated as inputs in the production of final goods, as long as they are subsequently exported.
“But there are companies that tell us, I’m going to import it for that, and it’s not true, they sell it here. So we were instructed by the President (Claudia Sheinbaum) to take this measure so that they do not abuse this provision,” he added.
Market
According to the decree, in the period from 2019 to 2023, imports of textile industry goods grew at an annual rate of 0.8 percent, while those of the apparel industry increased at an annual rate of 12.5 percent.
The situation is particularly complicated for these industries. First of all, they are inputs, semi-finished products and finished products. This causes a displacement of domestic industry.
Secondly, imported products show a notable difference in their prices. This difference is due to the fact that products coming from countries with which Mexico does not have a Free Trade Agreement are cheaper than those coming from countries with which it does have this agreement.
Between 2021 and 2023, a difference in the implicit prices of several products was observed. For example, blankets, curtains, bedspreads and upholstery articles from countries without a trade agreement were cheaper by US$18.48. As for sports or workout clothes, the price difference was 13.14 dollars.
For coats, suits, jackets, pants and dresses, the price was 9.81 dollars lower. For accessories, such as gloves, sashes and ties, the difference was 2.91 dollars. Knitted fabrics had a difference of $3.75, while knotted mesh fabrics and ribbons were cheaper by $1.67. Finally, cotton fabrics showed a $1.48 difference in price.