Mexico Targets U.S. Tech Giants With Proposed Digital Tax Amid Tensions

A New Source of Conflict Between Mexico and the U.S.

Mexico and the United States are facing a new point of friction—this time in the tech sector. José Merino, head of Mexico’s Digital Transformation Agency, has summoned five major U.S. tech firms to discuss a new internet service tax.

However, this measure is not included in existing regulations or trade agreements, raising concerns within the U.S. embassy in Mexico. With a March 4 deadline looming, this proposal adds another layer of complexity to the ongoing T-MEC (USMCA) negotiations.

Is This a Government Strategy or a Rogue Initiative?

The key question remains: Is this an official Mexican government policy, or is Merino acting independently?

Although the Mexican government has sought to increase tax revenues, a digital tax outside the regulatory framework could escalate tensions with the U.S.—especially as both countries engage in crucial trade discussions.

Unresolved Controversies: The Prepaid Collection Reform

While digital tax disputes grow, another controversial reform—the prepaid collection initiative—continues to stir debate in Mexico’s Congress.

Even after intense negotiations, lawmakers failed to kill the bill, prompting Deputy Alfonso Ramírez Cuéllar to personally intervene in the Senate to block its approval.

Key Issue: Despite public opposition, no politician has openly taken responsibility for drafting the proposal.

Who’s Behind the Reform?

• Pedro Haces, a member of MORENA, has been linked to the initiative but remains silent.
• Senate President Gerardo Fernández Noroña has dismissed it as “unviable” without further elaboration.

This issue remains a political hot potato, with no clear accountability among lawmakers.

Mexico’s Ban on GM Corn: A Brewing Trade Dispute

Another point of contention is Mexico’s proposed ban on genetically modified (GM) corn. On Monday, February 12, top Mexican officials will attend a Congressional hearing to discuss Claudia Sheinbaum’s initiative to prohibit GM corn cultivation.

Who Will Be Present?

• Julio Berdegué (Minister of Agriculture)
• Luz Elena González (Minister of Energy)
• Rosaura Ruiz (Minister of Science and Technology)
• Marcelo Ebrard? (Possible Minister of Economy)

The U.S. government has voiced concerns, fearing that Mexico’s GM corn restrictions could disrupt agricultural trade between the two nations.

Key Fact: Although Mexico lost a trade dispute over GM corn imports, its domestic ban remains a point of debate.

While the ban won’t directly impact U.S. exports, Washington could use it as leverage in the upcoming USMCA (T-MEC) renegotiations.

Cuauhtémoc Blanco’s Political Trial in Limbo

Former Morelos governor and current MORENA congressman, Cuauhtémoc Blanco, is facing an impeachment request after being accused of attempted sexual assault.

However, despite political pressure, the process remains stalled.

Key Developments:

• In October 2024, Hugo Eric Flores (Chair of the Jurisdictional Commission) stated that political trials would move forward.
• Five months later, the Subcommittee for Preliminary Examination has not yet convened.

As public scrutiny intensifies, the big question remains: Will Blanco’s case proceed, or will it be swept under the rug?

Mexico-U.S. Relations: Key Issues to Watch

With March 4 fast approaching, tensions between Mexico and the U.S. are rising. The key issues shaping the diplomatic landscape include:

Proposed digital tax on U.S. tech companies, raising concerns within the U.S. embassy.
The prepaid collection reform, which remains a controversial and unresolved issue in Mexico’s Congress.
The GM corn ban, potentially affecting U.S.-Mexico trade agreements.
Cuauhtémoc Blanco’s impeachment case, which has stalled in Congress despite legal proceedings.

These ongoing disputes will likely influence trade talks, political negotiations, and regulatory decisions in both countries in the coming months.

How will these tensions impact the future of U.S.-Mexico relations? Stay tuned.