After three months of negotiations, the Chamber of Deputies cleared the way and approved this Wednesday the official proposal to impose tariffs of up to 50% on imports of certain products from countries with which Mexico does not have a trade agreement.
With 281 votes in favor from deputies of Morena and the Green Party, the amendment to the tariff of the Law on Import and Export General Taxes (LIGIE) was sent to the Senate. The goal is to have it approved before December 15 and come into effect on the first day of 2026, as requested by the Executive from the Morena caucus in San Lázaro.
The vote had 24 votes against from Movimiento Ciudadano and 149 abstentions from the opposition parties PAN and PRI, plus the votes of the Labor Party.
The inflationary risk of tariffs on China
The initiative, presented by President Claudia Sheinbaum in September along with the 2026 Economic Package, proposes imposing tariffs of between 25% and up to 50% on 1,463 tariff headings of products from countries without trade agreements with Mexico. Among the most prominent are China, but also South Korea, the European Union, India, Japan, Indonesia, Vietnam, Russia, Malaysia, Singapore, Thailand, and Turkey.
Its approval was put on hold due to business warnings that many of the tariffed products are inputs that can increase the cost structures of companies and impact inflation.
The draft bill that was finally sent to the Lower House was modified by the Economy Commission, with significant cuts to many of the originally proposed tariffs in sectors such as cosmetics and toiletries, textiles and apparel, leather goods, paper and cardboard, wooden furniture, and various auto parts; although it kept the 50% maximum tariff unchanged for complete vehicles, including electric ones, and for a limited group of steel products.
The official discourse justifies the measure as a way to protect the national industry, but the private sector interprets it as a requirement in the run-up to the review of the USMCA next year.
The Senate must approve it before December 15 for it to come into effect on the first day of 2026, as requested by the Executive from the Morena caucus in San Lázaro.
"The effect of tariffs on inflation concerns me," assured Citi's chief economist, Julio Ruíz, just this week during the bank's year-end presentation.
"The increase in the cost of final products can boost local production. But at the same time, having more expensive intermediate products can affect inflation, and that is an effect that is not going to disappear so quickly," he added.
