The tax authorities of South Korea and Mexico are collaborating to address tax issues faced by Korean companies operating in Mexico, including delays in value-added tax (VAT) refunds and double taxation. The Mexican side expressed its commitment to enhance communication with Korean businesses and provide support for corporate tax filing guidance.
The National Tax Service announced that Commissioner Im Kwang-hyun held the first South Korea-Mexico Tax Agency meeting with Antonio Martinez Dagnino, the head of Mexico's Tax Agency, in Mexico City on September 22.
Prior to the upcoming South Korea-Mexico summit, the two tax agency heads convened to strengthen tax cooperation.
During the meeting, Commissioner Im conveyed the tax challenges faced by Korean companies, including delays in VAT refunds and issues related to double taxation between the two countries. He requested special attention and proactive support to enable Korean companies to contribute to the Mexican economy through stable business operations.
In response, Dagnino stated, "When tax issues arise for Korean companies, we will actively communicate with them to resolve the problems," adding that he would spare no effort in providing tax support, including guidance on corporate tax filing.
Before the meeting, Commissioner Im held a business forum on September 21 to gather feedback from companies operating in Mexico. Carlos Camero, the chief of transfer pricing at Mexico's Tax Agency, attended the forum, marking the first time a senior official from the Mexican tax authority participated to directly address the concerns of Korean businesses.
Participating companies shared difficulties they encounter in local operations, including tax audits, delays in VAT refunds, and double taxation. They particularly highlighted challenges in fulfilling tax obligations due to differences in tax laws and filing procedures between the two countries, requesting improved communication for tax filing guidance and issue resolution.
Camero emphasized the importance of Korean companies in the Mexican economy and pledged to continue efforts to reduce tax uncertainties while expanding communication with businesses, including consultations.
Mexico serves as a production and export hub for Korean companies entering the North American market and is the largest trading partner in Latin America. The trade volume between the two countries increased from $19.1 billion in 2023 to $19.9 billion in 2024, and reached $20.5 billion last year. As of last year, 562 Korean companies were active in Mexico, primarily in manufacturing sectors such as automotive, electronics, and steel, with approximately 14,000 Korean nationals residing there.
Following the forum, the National Tax Service's "K-Tax Angel Team" conducted a tax briefing for the companies and Korean nationals. The session covered tax matters of interest, including the transfer, inheritance, and gift of assets in Korea, as well as transfer pricing.
Launched in January of this year, the K-Tax Angel Team consists of National Tax Service employees with expertise and experience in property taxation and international tax matters. Commissioner Im stated that providing administrative services to overseas Koreans is a fundamental duty of the government and pledged to widely promote the system through embassies and other channels.
The two tax authorities also agreed to collaborate in sharing experiences and policies related to electronic taxation and to expand practical exchanges. Commissioner Im introduced examples of digital transformation in tax administration, including the operation of electronic tax invoices and home tax systems, as well as tax source management using artificial intelligence (AI) and big data.
Dagnino expressed great interest in South Korea's AI transformation, particularly in AI systems for detecting tax evasion, and suggested continuing practical exchanges to benchmark South Korea's electronic tax administration.
* This article has been translated by AI.
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