All film/video productions shot in Mexico and whose primary exploitation will be done outside Mexico are considered an “export product” and will be exempt from Value Added Tax (VAT). All your expenses for a 0% VAT have to be billed by one company, and that company needs an authorization from the IRS (SAT) prior to invoicing the project.
A tax incentive is granted to the income taxpayers, consisting in a fiscal credit equivalent to the amount that these taxpayers contribute during the corresponding fiscal year to investment projects for domestic cinematographic production, against the income tax or the asset tax charged to them in the fiscal year said credit is determined. Such incentive may in no case exceed 10% of the income tax charged for the fiscal year immediately preceding the one of its application.
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ProAV Fund is a program to support the audiovisual industry that complements the existing public policy of supporting the industry in Mexico. This incentive offers up to 17.5% of the production disbursements made in Mexico back to the producer.
It consists of cash reimbursement applied on the documented expenses and the refund of the Value Added Tax (VAT) incurred by the production in Mexico. In addition, an integral plan specializing in the high impact film and audiovisuals is created to offer productions a better experience when filming in Mexico.
Any film or audiovisual production spending a minimum of 40 million pesos en Mexico during its development and production phases, and/or 10 million pesos on post production, may qualify for the financial reimbursements.
Production and post production expenses can be combined, but in that case, a minimum of 40 million pesos must reached.
Some states and cities also offer small incentives, especially for feature film projects shot in their jurisdiction. These incentives may include lodging and transportation during location scouting, special discounts on some services, etc. These incentives are not always available and need to be reviewed on a particular basis.