What is the IVA tax?     In Spanish IVA stands for Impuesto al Valor Agredado or in English, the Value Added Tax.  It is Mexico’s national sales tax that is placed on goods and services.  Price tags at retail stores include IVA so the amount you see on the price tag is the price you pay at check out.  This is different than the USA where the sales tax is added at the payment counter.  The exceptions for this tax are food (not including restaurants) and medicines.  

In most areas of Mexico the standard IVA rate is 15% but in the free zone, which includes border towns, Puerto Penasco, and San Carlos areas as well as the entire Baja Peninsula, it is only 10%.   In January 2010 the Mexican government raised the IVA rate by 1%, changing our rate here in Rocky Point  to 11%. 

IVA is collected by S.A.T (Servicio de Administracion Tributaria), known as Hacienda, which is the federal tax collector.  It is the equivalent of the IRS in the United States.