Justification and motivation of the minimum fines

9 August 2023

The Tax Administration Service must consider different aspects when determining a fine to taxpayers. Such fine must be legally justified and reasoned by the authority, in order to comply with the proper procedure.

As established in Articles 14 and 16 of the Mexican Constitution, all Administrative Acts issued by competent authorities must be properly justified and motivated in order to comply with the principles of legality and legal certainty referred to in the aforementioned precepts.

The tax authorities must consider different criteria when determining sanctions and respect the requirements of the Mexican Federal Tax Code (“CFF” for its acronym in Spanish) and other applicable legal standards. In order to comply with the principles and legal precepts, the authorities must take into account the following, prior to determining fines against taxpayers:

– – The offender’s economic capacity;

– – The recidivism;

– The severity of the infraction committed.

There is jurisprudence of the Mexican Supreme Court where it is established that violations can be

imposed with the mere proof that the event existed, without it being necessary to indicate the reason that led them to determine such fine.

In this regard, the Superior Chamber of the Federal Court of Administrative Justice has issued several precedents in which it determines that for the application of minimum fines, it will only be sufficient to prove the existence of the infringing conduct to have accredited the motivation referred to in Article 16 of the Mexican Constitution, without it being necessary to deepen into a motivation per se.

In light of the above, in Bravo Abogados we would be happy to answer any question you may have regarding this legal alert.

Blvd. Antonio L. Rodríguez 3000, Colonia Santa María, 5to piso, Interior 501 Torre Albia, C.P. 64650 Mty, N.L., México T.

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