The principal taxes payable by commercial and industrial enterprises operating in Mexico and, in certain cases, by foreign companies and individuals, are those levied by federal government. State and municipal governments have more limited tax powers and also receive allocations of some federal taxes collected within border. The principal taxes are as follows:

1. Federal Taxes:
   • Income Tax
   • Value-added Tax
   • Asset Tax
   • Payroll Taxes, mainly social security
   
   
2. Local Taxes:
   • On real property
   • On salaries

Foreign Operations
Individual and corporate residents of Mexico are subject to Mexico taxation on their worldwide income. Tax credit up to the amount of the Mexican income tax is allowed for foreign income taxes paid in foreign source income, and the law is designed to avoid double taxation of international transactions.