Gas industry entrepreneurs represented by the National Organization of Oil Exporters (ONEXPO) and the Tijuana Gas Station Owners Association (APEG), with the support of the Business Coordinating Council of Tijuana, started 2017 by leading the most important boycott in Mexico against the tax reform and in particular the fuel price hike. This movement was led by Dr. Adolfo Solis, Grupo Farias Managing Partner, who presented on February 10th to the District courts in Tijuana the collective boycott -with more than 26,000 signatures- to defend through legal channels an adequate and competitive price change that follows clear rules.

What is sought with this boycott is to destroy the methodology used to fix the price of fuel, which Dr. Solis Farias described to be invented, abstract, vague, and structured to follow international parameters supported by unofficial information of private institutions.

In an interview for Business Conexion, the tax lawyer noted that neither the cost of the molecule, nor the cost of a barrel of oil, refining, importation, and much less distribution, have had experienced major changes in international markets to lead to an increase. The exchange rate has risen, but why does this have to be a factor in determining the price of fuel, he asks. "Mexico does not buy dollars; Mexico receives dollars and pays the cost of refining through flexible lines of credit in dollars."

At the institution level, he points out that the judicial system is fractured after having incorporated magistrates and ministers with political trajectory at the federal level who have been at the service of the Ministry of Finance. "The incorporation of this type of people into the judicial system results in the protection of the state in its abuses and excesses. Unfortunately, the issues with greatest priority for this country are being eradicated in those courts, where the people running the courts are acquaintances or friends of the politicians". However, he emphasizes that this should not discourage us, because social struggles generate evolution and transformation. "The social struggle that is carried through the legal path has greater capacity and potential for durability than the speeches that are issued in forums or in demonstrations; The social struggle through the legal route has been subject to trial by the State for one or two years, and sometimes a march represents for the State a nuisance of a day, because it is a spontaneous and unique act that does not change the institutions," he says.

"The imposition of more taxes is the result of a lethargic population"

According to the specialist, individuals are relaxed and this has given rise to the increase in taxes. Last year, the Mexican government raised taxes by $308 billion pesos (about $16.4 billion dollars) more than estimated, according to the 2016 Fourth Trimester Tax Management Report.

"The goal that was estimated in the Federation's Income Law amounted to $2.4 billion pesos (about $127 million dollars), but the year closed at $2.7 billion pesos (about $149 million dollars). Therefore, it can be stated that the imposition of more taxes is not always due to low tax collection, but a lethargic population."

He added that what is budgeted and what is seen in the public account do not coincide, and that the expenses are not used according to the budget. In other words, it is possible that the President of Mexico and the legislative powers spend up to seven times more than what is allocated for them in the budget.

"The population is relaxed and tired and this has allowed politicians to steal money. The culprits of this are the citizens themselves not claiming lasting actions, but with sporadic claims that suffocate over time," he says.

"The liberalization of the importation of gasoline, a factual operation"

Companies that supply gas stations and businesses that want to become independent of the Petroleos Mexicanos (PEMEX) supply fuels collect 248,700 billion liters through 206 permits for importation in the coming years. This amount is close to three years of what is consumed on average by the Mexican market, according to data from the Secretary of Energy (SENER). So far, no company has used its permits to import gasoline for commercialization at service stations.

"The liberalization to import gasoline and open service stations is a factual operation because today it costs more to import gasoline, to storage it and distribute it to the point of sale, instead to buy it in Mexico," says Solis Farias. In his point of view, PEMEX's formula is designed not to lose, as the company would disappear the moment another business with better prices and product appears. "This explains the manipulation of the price structure."

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