MONTERREY, Mexico--(BUSINESS WIRE)--Fitch Ratings has published a special report titled 'Reforms to the Subnational Sector in Mexico: Strengthening the Institutional Framework of Local and Regional Governments', which describes the effects that reforms that have been approved at the federal level (tax and fiscal coordination) will have according to Fitch Ratings, as well as the eventual approval of the constitutional reforms concerning fiscal responsibility matters that are currently being discussed in the Congress of the Union.
The report also highlights the estimated growth in the federal revenue sharing (participaciones federales) given the changes that have been approved in fiscal matters at the federal level and outlines the main modifications to the Fiscal Coordination Law, which, according to Fitch, will provide incentives to improve the revenue collection efficiency of subnational governments and will provide better management and transparency to the resources that are transferred to such governments through Ramo 33 federal contributions.
Fitch considers that the amendments to the Fiscal Coordination Law and to the regulation included in the constitutional initiative on matters of financial discipline that is currently under discussion in the Congress of the Union, will strengthen the institutional framework of the subnational entities on indebtedness responsibility, through the establishment of formal prudential rules and greater supervision of the Federal Government.
The special report titled 'Reforms to the Subnational Sector: Strengthening the Institutional Framework of Local and Regional Governments' is available at www.fitchratings.mx and www.fitchratings.com.
Additional information is available at 'www.fitchratings.com'.
Applicable Criteria and Related Research: Reforms to the Subnational Sector (Strengthening the Institutional Framework of Local and Regional Governments)