Mexico City. The Ministry of Finance and Public Credit (SHCP) proposed that the fiscal deficit in expanded form for 2025 be 3.9 percent of the gross domestic product (GDP), which would imply a reduction of 2 percentage points compared to the level of 5.9 percent of the GDP, with which the agency hopes to close 2024.
When delivering the economic package for 2025 to the Chamber of Deputies, which includes the draft Expenditure Budget and Income Law for next year, Rogelio Ramírez de la O, Secretary of the Treasury, detailed that the 2025 budget deficit, the which relates in particular to the budget of the federal government, will be 3.2 of GDP, while the public debt will be equivalent to 51.4 percent of GDP.
The official projected that the economy would grow in 2025 in a range of between 2 and 3 percent, which is based on the strength of employment and internal dynamism with consumption and investment as key drivers.
In line with these growth expectations, the Federal Income Law initiative foresees income of 8 billion pesos, with tax collection as the main source of generation.
“The projection of 5.3 trillion pesos in tax revenue represents an increase of 2.6 percent in real terms compared to 2024, and for the first time in our history. Tax revenues will reach 14.6 percent of the gross domestic product,” he said.
He added that these results are achieved without creating new taxes or increasing existing ones in real terms.
“We are confident that the collection measures and tax digitalization, led by the Tax Administration Service and the Digital Transformation and Telecommunications Agency, will expand tax work and improve inspection even further in 2025.
Regarding spending, the budget project reaffirms the government’s commitment to lower-income sectors.
“In 2025 we will continue to think about social programs that have a direct impact on the well-being and quality of life of millions of Mexicans, and indirectly on aggregate consumption in national accounts, which are the most important component of the gross domestic product,” he highlighted.
Among the most notable programs – said Ramírez de la O – is the “women’s well-being pension” that will benefit 1.2 million women between 63 and 64 years old with a progressive plan to extend until age 60.
“This initiative recognizes the unpaid work of many Mexican women,” she said.
The head of public finances recognized the legislature’s efforts in converting social programs into constitutional rights.
“This step is fundamental since social programs are not gifts or mere opportunities, they are basic rights of Mexicans and the State has the responsibility of guaranteeing them.”
Ramírez de la O stated that the vision of the economic package is reflected in two economic policy criteria that present a realistic evaluation of the economic situation, considering both the challenges and opportunities at a global level.
“This package marks the beginning of a new government that, like the previous government, has a shared vision of economic growth with social justice, where the State plays an active role as a promoter of collective well-being,” the official highlighted at the beginning of his speech. speech.
He asserted that one of Mexico’s main historical challenges is inequality.
“The public budget complies with the economic policy of recent years, it reflects our fight to reduce inequality in all its forms,” he mentioned.
“Social programs and labor reforms have contributed to improving income distribution and raising the well-being of families.”
He explained that in terms of infrastructure, the objective is to improve connectivity and strengthen the internal market.
The expansion of the railway system for both passengers and cargo is a priority in the administration and will bring benefits to both productive companies and the population.
“Since the last administration we have recovered the public budget and particular interests and we have returned it to where it belongs, at the service of all the people of Mexico,” he stated.
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#SHCP #proposes #deficit #GDP
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Considering potential global economic headwinds, such as inflation and supply chain disruptions, what contingency plans should be incorporated into the 2025 budget to ensure its stability and effectiveness?
## World Today News Podcast: Mexico’s 2025 Budget - A Conversation With Experts
**Host:** Welcome back to World Today News podcast. Today we delve into the implications of Mexico’s proposed 2025 budget, which aims to significantly reduce the nation’s fiscal deficit. To unpack this complex economic plan, we have two esteemed guests: Dr. Maria Sanchez, renowned economist specializing in Latin American economies, and Mr. Arturo Lopez, a financial analyst with a focus on Mexican public finance.
**Section 1: Deficit Reduction and Economic Growth**
**Host:** Dr. Sanchez, the SHCP proposes a substantial reduction in the fiscal deficit, targeting 3.9% of GDP by 2025. What are your initial thoughts on the feasibility and potential implications of this ambitious goal?
**Dr. Sanchez:** … (Dr. Sanchez will discuss the feasibility of the deficit reduction, potential challenges, and wider economic implications.)
**Host:** Mr. Lopez, the government projects a growth rate between 2-3% for 2025. How realistic is this projection considering the global economic landscape and Mexico’s internal dynamics?
**Mr. Lopez:** … (Mr. Lopez will analyze the projected growth rate, factoring in global trends, domestic factors, and potential risks.)
**Section 2: Revenue Generation and Taxation**
**Host:** A key aspect of the budget is increased tax revenue, projected to reach 14.6% of GDP in 2025. Dr. Sanchez, how does this compare to other Latin American nations, and what are the potential benefits and drawbacks of relying on tax revenue as the primary source of income?
**Dr. Sanchez:** … (Dr. Sanchez will provide a comparative analysis with other Latin American countries, discussing the pros and cons of reliance on tax revenue.)
**Host:** Mr. Lopez, the government emphasizes achieving this revenue target without introducing new taxes. How achievable is this goal considering existing inequalities and potential taxable sectors yet untapped?
**Mr. Lopez:** … (Mr. Lopez will analyze the feasibility of achieving the desired revenue without introducing new taxes, considering existing structures and untapped potential.)
**Section 3: Social Programs and Budget Priorities**
**Host:** The budget prioritizes social programs, particularly the “women’s well-being pension,” which targets millions of economically vulnerable women. Dr. Sanchez, how effective have similar social programs been in Mexico and other developing nations in addressing inequality and improving social outcomes?
**Dr. Sanchez:** … (Dr. Sanchez will discuss the effectiveness of similar programs globally, highlighting best practices and potential pitfalls.)
**Host:** Mr. Lopez, the budget also emphasizes infrastructure development, particularly rail expansion. What are the economic benefits and potential challenges of such projects within the context of Mexico’s current infrastructure needs?
**Mr. Lopez:** … (Mr. Lopez will analyze the potential economic impact of infrastructure projects, considering cost-benefit analysis and implementation challenges.)
**Section 4: Looking Ahead**
**Host:** both of you, what are the key takeaways from this budget proposal, and what should we be watching for as it progresses through legislative deliberation and implementation?
**Dr. Sanchez:** … (Dr. Sanchez will summarize key takeaways and future considerations.)
**Mr. Lopez:** … (Mr. Lopez will provide his concluding remarks and insights.)
**Host:** Thank you both for joining us today and sharing your valuable perspectives on Mexico’s crucial 2025 budget. This was World Today News Podcast, stay tuned for our next episode.
