Teaching Comparative Government and Politics

Wednesday, September 11, 2013

Proposing more change in Mexico

President Peña Nieto wants to build on his successes. He sounds like he wants the PRI to be a party of 21st century revolution.

Mexican president proposes sweeping social changes

Mexican President Enrique Pena Nieto proposed sweeping changes to the country's social programs Sunday, laying out a plan for Mexico's first nationwide pensions, unemployment insurance and capital-gains taxes.

Some Mexican local governments, and particularly Mexico City, have experimented with small supplementary payments to the unemployed and people older than 70, but the country as a whole has not had unemployment insurance and only has a patchwork of pension plans…

The changes are part of a series of ambitious reforms that Pena Nieto hopes to push through in his first year in office. Some, like educational reforms that introduce teacher evaluations, have sailed through congress, but others face an uphill fight…

Pena Nieto did not provide specifics of the social program plans or tax changes, but said that "those who have more income will pay more."…

The proposals must be approved by both houses of congress and a majority of state legislatures because they involve constitutional changes.

Few had expected the president, whose centrist Institutional Revolutionary Party is known for its close ties to business, to go so far.

Indeed, some had expected him to push the widely unpopular idea of extending the sales tax to food and medicines. Such a tax would have likely further angered protesters who have recently demonstrated, in a country where 45 percent of the population of 112 million lives in poverty.

Pena Nieto said he didn't adopt that approach because it would hurt the poorest Mexicans, but said he would follow through with periodic increases in gasoline prices, which is aimed at phasing out fuel subsidies in Mexico…

Alternatively, the financial reporters focused on the taxations, not the social welfare reforms.

Peña Nieto waters down Mexico tax reforms

Mexico's faster-than-expected economic slowdown forced Enrique Peña Nieto, the country’s president, to dilute key tax reform plans, shying away from slapping a widely expected sales tax on food and medicine that could have intensified a wave of popular protests.

But the president said the reform package, which he unveiled on Sunday night flanked by opposition parties, nonetheless included green taxes on fuel, a fat tax on sugary drinks and a stock market gains tax. The reform package has been presented as a decisive step towards funding universal social security and making the tax system fairer and clearer…