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Mexico Deposits Ratification Instrument for BEPS MLI — Orbitax Tax News & Alerts

On 15 March 2023, Mexico deposited its instrument of ratification for the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). Based on the date of deposit, the MLI will enter into force for Mexico on 1 July 2023, although its entry into force for Mexico's covered agreements (tax treaties) will depend on the ratification of the MLI by the counterparty to a particular covered agreement.

The MLI will generally enter into force for a particular covered agreement on the first day of the month following a three-month period after both parties to the covered agreement have deposited their ratification instrument. Once in force, the provisions of the MLI will generally apply for a covered agreement from 1 January of the year following its entry into force in respect of withholding taxes, and for all other taxes with respect to taxable periods beginning on or after the expiration of a 6-month period following the date of entry into force. However, for Mexico's own application of the MLI in respect of other taxes, Mexico has taken the reservation that the MLI will apply for tax periods beginning on or after 1 January of the next calendar year following a six-month period after the MLI's entry into force.

Click the following link for Mexico's definitive list of reservations and notifications made upon deposit of the ratification instrument.