U.S. Exit from the OECD Global Minimum Tax Raises Mexico’s Fiscal and Competitive Pressure
The United States’ decision to step away from the OECD/G20 framework to apply a 15% global minimum tax on multinationals has once again set off warning lights in Mexico—both because of the potential impact on tax revenue and because of the effects on competition to attract investment. The international deal—known as Pillar Two—aimed to limit base erosion and profit shifting to low-tax jurisdictions, while also creating a “level playing field” for investment in an environment where global supply chains and the digital economy have made traditional tax enforcement more difficult.
According to information released by U.S. authorities, the new understanding with countries in the Inclusive Framework would allow companies headquartered in the U.S. to be governed primarily by domestic tax rules, effectively exempting them from the application of Pillar Two abroad. For Mexico, this shrinks the scope of a pool of potential revenue tied to global profits that, under the original framework, could be taxed where companies carry out real economic activity. In practical terms, it reduces the room for investment-recipient countries—like Mexico—to capture a larger share of taxes on profits generated locally but booked for tax purposes in other territories.
The issue matters even more for Mexico given the strong presence of U.S. capital. In recent Foreign Direct Investment (FDI) flows, U.S. companies have accounted for a significant share of the total, making any change in that country’s corporate rules a key factor in the financial and tax planning of groups operating on both sides of the border. In addition, in a nearshoring context, the decision adds uncertainty about how far multinationals might re-optimize structures, locations, and transfer pricing to take advantage of tax differences across jurisdictions.
The topic intersects with a broader debate: relative tax competitiveness. In Mexico, the federal corporate rate is 30%, while in the United States there has been discussion of cutting the corporate tax from 21% down toward levels closer to 15%. If that cut materializes, the tax gap would widen on paper, potentially strengthening incentives to concentrate profits or corporate functions in the U.S., leaving Mexico with more limited operations. Still, specialists often emphasize that investment decisions don’t depend on taxes alone: logistics costs, labor availability, regulatory certainty, security conditions, energy, and market access also weigh heavily.
In that sense, Mexico retains structural advantages that are hard to replicate: geographic proximity to the world’s largest consumer market, deep regional production integration, and the USMCA framework, which—despite recurring frictions—continues to serve as an anchor of certainty for manufacturing, auto parts, electronics, and medical devices. Access to natural gas imported from Texas also plays a role, as it has been a key input for industry. At the same time, the country faces challenges that affect costs: infrastructure gaps, customs bottlenecks, the availability and quality of electricity in industrial regions, and upward pressure on labor costs driven by minimum-wage increases and a tighter labor market in manufacturing hubs.
On the tax and administrative side, the U.S. pullback from the global framework makes international coordination harder. For Mexico’s finance authorities, the challenge is not only whether to “collect more or less,” but to design clear rules that reduce litigation and avoid double taxation or tax gaps. In particular, Mexico may be forced to operate with differentiated standards: one practical treatment for groups headquartered in the U.S.—under whatever rules Washington advances—and another for multinationals from countries that do apply Pillar Two. This could increase compliance burdens and raise the regulatory cost of doing business, just as Mexico is competing with other destinations for relocation projects.
Looking ahead, the debate opens a window to revisit competitiveness strategy beyond headline tax rates. With limited fiscal space—due to spending pressures, the debt’s financing cost, and public investment needs—Mexico has less room to cut taxes across the board. As a result, the conversation tends to shift toward macro stability, administrative simplification, the rule of law, targeted incentives, and trade facilitation policies. In parallel, the USMCA review and the evolution of industrial policy in North America could redraw the investment map, with greater emphasis on strategic sectors, regional content, and supply-chain resilience.
In sum, the United States’ exit from the global minimum tax reduces the reach of tax coordination designed to curb aggressive tax planning and may diminish part of Mexico’s potential revenue linked to multinational profits. Even so, the ultimate impact will depend on whether the U.S. cuts its corporate tax, how USMCA rules evolve, and—above all—Mexico’s ability to strengthen certainty, energy supply, and infrastructure, factors that often matter as much as the tax burden in investment decisions.
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