The Tariff Mexico Charges You on the Way In

Most of the tariff work being done on Mexico right now is about the duty a good pays going north into the United States. There is a second tariff, it is charged on the way in, and it is the one that lands on your bill of materials.

On August 30, Mexico's Secretary of Economy defended it in public.

Marcelo Ebrard told reporters the measures are doing their job: "Están funcionando desde el punto de vista que estamos reduciendo importaciones en una parte importante." Imports from China fell 28.4 percent across the first five months of 2026 against the same months of 2025. Footwear fell 59 percent. Light vehicles fell 35 percent. Appliances fell about 27 percent. Across all the affected tariff lines, imports came down 23.2 percent.

Those are the numbers of a policy working as designed. They are also the numbers of a cost that arrives the day you start buying inputs in Mexico.

What the tariff actually is

On January 1, 2026, Mexico raised import duties on 1,463 tariff fractions spanning more than twenty chapters of its tariff schedule. Most increases land at up to 35 percent. Specific lines reach 50 percent.

The sectors in scope read like a manufacturing bill of materials: automotive, textiles, apparel, plastics, steel, appliances, aluminum, toys, furniture, footwear, leather goods, paper and cardboard, motorcycles, trailers, glass.

It reaches goods originating in countries Mexico has no trade agreement in force with. For most companies that means China, South Korea, India, Vietnam, Thailand and Brazil. Anything qualifying under the USMCA is untouched.

Now the part worth holding onto. This was not an executive decree. The Chamber of Deputies passed it on December 10, 2025, the Senate approved it that same week, and the reform was published in the Official Gazette on December 29. The rates went into the tariff law itself.

Mexico's earlier rounds of tariff protection arrived as decrees carrying expiry dates. Trade counsel who tracked this one through Congress flagged the difference at the time: these rates were incorporated permanently. There is no sunset to wait out.

Why it will not be traded away

The budget has already spent it.

Import tax revenue is projected to rise from 151.8 billion pesos in 2025 to 254.8 billion in 2026. CIEP, the public finance research centre that ran those figures, puts the real increase at 60.15 percent and notes that tariffs of this kind function as a transfer paid by domestic buyers, which is why it argues their application "debe ser temporal."

That argument is on the record. So is roughly 100 billion pesos of additional revenue now carried inside the arithmetic that funds the federal budget. When you are judging how durable a rule is, follow the line that got spent.

The decision that determines whether you pay it

If your Mexican company imports those inputs definitively, meaning they enter to stay, you pay the duty at the rate in the schedule.

If they enter temporarily under an IMMEX program, you do not pay on entry. The distinction is worth up to half the value of the affected inputs, every year you operate.

The precision matters here, because it is where companies get comfortable too early. IMMEX defers the general import tax. It does not cancel it. Article 104 of the Customs Law and Article 15 of the IMMEX Decree hold the tax in suspense while the goods are in national territory, and the obligation resolves when they return abroad, transfer virtually to another IMMEX company, or change regime.

Change the regime to definitive and the duty comes due at the rate then in force. Let the goods sit past their term and the same thing happens.

So what you hold is not a status you acquire once. It is a condition you keep meeting, on inventory that has to trace back to the pedimento it arrived on. That is the same discipline behind the IMMEX suspensions we covered in August, where the programs at risk were lost on records rather than on intent.

There are also goods where the door is shut. Annex I of the IMMEX Decree lists what cannot be temporarily imported at all. Fifty codes covering finished footwear were added in August 2025. Most finished textiles and apparel in chapters 61, 62 and 63 sit outside the program as well. For those products there is no deferral to structure toward, and the duty is simply the duty.

Why this reached Canadian companies this month

Since August 19, roughly twenty billion dollars a year of Canadian goods have faced 50 percent tariffs entering the United States, and Ottawa's talks with Washington are suspended. We wrote about the Section 338 proclamations when they were signed.

The response at board level has been to look at production inside the agreement, and Mexico is where that conversation lands. So a set of Canadian companies are now modelling a Mexican footprint for the first time, on a compressed timeline, using landed-cost assumptions built before January.

Those assumptions are stale in one specific place. If your product carries Asian sub-components, the input side of the model is understated, and the gap reaches 35 percent on the lines that matter.

Where this meets the negotiating table

The United States and Mexico open a fourth round of USMCA review talks in Washington in early September, with rules of origin the unresolved item. In their July joint statement, Ambassador Greer and Secretary Ebrard underscored strengthening regional supply chains and addressing free-riding by countries outside the agreement.

Mexico put its version of that commitment into law before the round, and brings a measured 28.4 percent reduction to the table as something already delivered rather than something promised.

For you, the consequence is that non-regional content is being squeezed from two directions on two different clocks. Washington is pressing for more North American content in what crosses north, on the review calendar. Mexico is already taxing non-regional content on the way in, permanently. A sourcing plan has to answer both, and only one of them is still negotiable.

Three things to price before you commit to a structure

Run your actual bill of materials against the 1,463 fractions before you model landed cost. Rates vary line by line inside the same chapter, so sector-level commentary will not answer the question. One sub-component at 35 percent moves a plant's economics further than the wage differential that usually opens these conversations.

Treat IMMEX as part of the entity decision rather than as paperwork that follows it. If a meaningful share of your inputs comes from Asia and your output is bound for the United States, the program carries real annual value, and building the entity and the compliance around it from the start costs less than retrofitting both later.

Then look at what can be sourced inside the agreement instead. Mexico built this to make regional supply more attractive, and the 28.4 percent tells you buyers are moving. The supplier base you would be qualifying into is getting deeper while the tariff sits in the law, and a component you can buy regionally is one you never have to structure around.

What lands on September 8

Mexico's Ministry of Finance delivers the 2027 economic package to Congress on September 8, with Deputy Finance Minister María del Carmen Bonilla confirming it arrives on time.

New fractions, or moves on the existing rates, would show up there first. It arrives the same week the fourth round opens in Washington, which makes the first full week of September the one to watch on both sides of your cost model.

The bottom line

Mexico's inbound tariff is permanent law, it is funded into the budget, and it is doing what it was built to do.

What you control is whether your inputs meet it. That comes down to the origin of the parts you specify, the program you hold, and the entity you put underneath both, and all three are settled before the first container arrives.

If you are modelling a Mexican footprint this quarter, the useful hour is running your bill of materials against the schedule and pricing your duty exposure two ways: as a definitive import, and under a program you have to earn and keep.

Calder & Vale advises Canadian and US companies entering and operating in Mexico on entity structure, on site and incentives through direct relationships with the state economic development ministries, and on customs and origin exposure.