Mexico to help Pemex in debt
reduccion, tax, finances
Mexico to Announce ‘Significant' Aid for Pemex -Arturo Herrera, Finance Minister
- Government to reduce state oil giant's tax burden in 2021
Government will work on Pemex debt situation in coming weeks
By Max De Haldevang/Bloomberg
Petroleumworld 02 18 2021
Mexico will announce a significant reduction to state oil firm Petroleos Mexicanos' tax burden for 2021 in the coming days, Finance Minister Arturo Herrera said in an interview.
Lowering the state's demands on Pemex , its biggest taxpayer, could help the oil giant reorder its finances as it struggles with a $110.3 billion debt load, sinking production, and some of the highest tax obligations of any oil company in the world.
During the past two years Mexico adjusted its tax policy to compensate for a reduction in oil revenue from royalties and other contributions, Herrera said.
“We are heading in that direction, and in the coming days we will update how we continue down that path,” he said. “Anything to do with Pemex given its size has to be significant.”
The government will be working on Pemex debt in the coming weeks, Herrera said.
Pemex already has tax reductions lined up for this year, as a result of a change to Mexico's hydrocarbons revenue law to cut its profit-sharing duty for 2020 and 2021. The new announcement will be in addition to those reductions. Last year, Pemex received 46.3 billion pesos ($2.3 billion) in tax benefits thanks to the legal change.
— With assistance by Amy Stillman