The Mexican government proposed to slash state-owned oil major Pemex’s tax burden in the finance ministry’s 2022 draft budget presented to Congress on Wednesday. The proposal involves cutting the profit sharing rate (DUC), which is effectively a tax paid to the government, to 40% for Pemex from 54% in 2021, 58% in 2020 and 65% in 2019. This comes amid President AMLO’s push to revive Pemex, which has been struggling with mounting debt. The draft budget also forecasts a growth rate of 4.1% for 2022 for the Mexican economy with the Finance Minister Rogelio Ramirez de la O stating that the budget would focus on the well-being of Mexicans, financial stability and support for regional development. He also reassured that new taxes will not be created.

Pemex’s 5.95% 2031s have been trading higher this week, up over 2 points since Monday to 100.04 yielding 5.94%.
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