02 Apr The Joint Liability in Temporary Imports
Article 26 of the Federal Tax Code (“FTC”) sets forth the events of deemed joint liability of taxpayers. The main characteristic of such joint liability is that the deemed jointly liable party falls within the scope of the event, considered in the FTC, to assume the obligation to guarantee a tax liability, but such obligation is far from a legal contribution. This is, the joint obligor is only responsible, in particular situations in which the principal obligor failed to comply with tax obligations, and consequently, it is granted the status of taxpayer or principal obligor.
In customs matters, there are various scenarios where joint liability is provided for, however, in the case of temporary imports, we can observe the following two important cases:
Article 106, subsection II, of the Customs Law, sets forth a joint liability upon temporary importation of goods (6 months period, pedimento code BA), carried out by residents abroad, provided that the imported goods are used directly by the importer, or by people with whom the importer has a business relationship. Under this assumption, it will be necessary for the resident in Mexico to attach to the import pedimento a statement assuming joint and several liability in accordance with article 26, subsection VIII, of the FTC, for the tax assessment that may be derived for not returning the goods abroad, within the statutory 6 months period.
The second, and most recent scenario, was born with the publication of the Sixth Resolution of Modifications to the Foreign Trade General Rules for 2023, through which rule 7.3.3 subsection XIII, was amended. This amendment sets forth the benefits for those companies that have Registry in the Business Certification Scheme in the Authorized Economic Operator (“AEO”) modality. Subsection XIII of said rule, reads that IMMEX companies with AEO registry, may carry out the transfer of temporarily imported goods to companies resident in national territory, without the physical presentation of the goods (operation commonly known as pedimentos “V5”). In this sense, said rule originally established that the company resident in national territory receiving the goods must withhold VAT from the resident abroad, since the sale of the goods is carried out in Mexico, upon the material delivery in the country (consideration that is being successfully challenged in administrative litigation).
However, with the aforementioned amendment (which came into force on January 1st, 2024), sets forth that the company transfering the goods must file a clarification case through the SAT website, and filing a “voluntary statement” to assume joint and several liability, in terms of the aforementioned article 26, subsection VIII of the FTC. The acknowledgment of presentation of said format must be attached to the export pedimento (code “V5”).
Even though in this alert does not represent an in-depth analysis to consider whether such liability is actually joint, subsidiary, substitute or with some other characteristic, the purpose of this document is to identify that this new liability implies a new challenge for the country's manufacturing and export industry, by converting what was considered a logistical benefit into a greater responsibility for the transferring company of the goods, in addition to the already existing administrative burden.
Situation that can be challenged before administrative federal courts.
In Cuesta Campos we can advise our clients in any matter related to the application of this reform, as well as to understand the implications that it entails. Should you have any questions or comments, please do not hesitate to contact us.
Contact
Alejandro Martínez
Ana Victoria Parra Aceves
THE ABOVE IS PROVIDED AS GENERAL INFORMATION PREPARED BY PROFESSIONALS WITH REGARD TO THE SUBJECT MATTER. THIS DOCUMENT ONLY REFERS TO THE APPLICABLE LAW IN MEXICO. WHILE EVERY EFFORT HAS BEEN MADE TO ENSURE ACCURACY, NO RESPONSIBILITY CAN BE ACCEPTED FOR ERRORS OR OMISSIONS. THE INFORMATION CONTAINED HEREIN SHOULD NOT BE RELIED ON AS LEGAL, ACCOUNTING OR PROFESSIONAL ADVICE BEING RENDERED.