Mexico’s PRI to Push Bylaw Changes for Oil and Tax Bills

Leaders of Mexico’s ruling party will propose changing its bylaws to allow taxes on food and medicine and increased private investment in the state-owned oil industry, according to one of the authors of the changes.

The new language will be presented at the Institutional Revolutionary Party’s national assembly March 1-3 in Mexico City, said Javier Trevino, a congressman on the assembly’s organizing committee.

President Enrique Pena Nieto has pledged to lift growth by boosting tax collection and breaking Petroleos Mexicanos’s oil monopoly after eight years of production declines. Changing his party’s bylaws would give Pena Nieto the option of presenting bills to expand the items covered by the nation’s value-added tax and amend Mexico’s Constitution to let companies sign joint ventures with Pemex, Trevino said. The President hasn’t yet announced specifics for his planned legislation.

The party will “very likely” vote to approve the changes, Trevino said yesterday in an interview in Mexico City. The moves will “allow the president to make the changes he needs to get the economy growing,” he said.

An internal party document called the Action Program currently states that the PRI “won’t accept applying VAT on food and medicine” and supports “the principle of a nationally integrated oil industry that conforms to what’s established in Articles 25, 27 and 28 of the Constitution.”

Constitutional Changes

Those Constitutional articles would need to be changed in order to boost private investment in the oil industry, Trevino said. Such modifications would also require approval by two-thirds of Congress and a majority of legislatures from 31 Mexican states and the Federal District.

The PRI convenes members from across the nation only once every three years, lending urgency to next month’s meeting in resolving internal party limitations to Pena Nieto’s economic overhauls, Trevino said. Other changes to the party’s rules are also being considered, he said.

One day after Pena Nieto took office on Dec. 1, the PRI signed a so-called Pact for Mexico with other major parties, setting out an agreement to present both oil and tax legislation this year. The Pact didn’t contain specifics of the proposals.

“I don’t see very strong opposition to the changes,” Trevino said. “In fact I see general support.”

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