Tax Changes For 1997 Published

• the law lists 87 tax havens for capital gains purposes and 65 for other types of income;
• all investments in tax havens have to be reported (as of February 1998). Failure to report such investments will be treated as a criminal offence;
• generally, payments made to residents of tax havens are not deductible, unless the taxpayer can prove that the underlying transaction is at arm's length;
• payments between Mexican enterprises or a foreign-owned permanent establishment in Mexico and residents of tax havens are treated as related-party transactions; and