Food inflation causes crisis in Mexico’s poorest households: Oxfam

In a country like Mexico, which is characterized by inequality, food inflation generated a crisis for the poorest households, warned the NGO Oxfam Mexico.

Low-income families tend to allocate a greater proportion of their income to basic products and since 50% of the general rise in prices has been concentrated in food, “it has caused an even worse crisis in low-income households.”

Inside the report Who pays the bill in the face of the crisis in Mexico? emphasized that there are currently 43.9 million people living in poverty and 8.5 million in extreme povertywhile there are 15,000 millionaires.

They stressed that millions of workers lost their jobs or their working conditions became more precarious after the pandemic and those who kept it, maintained the same level of tax burden on their work as well as VAT and IEPS when making their purchases.

Among those who are in formality as in the informalityhousehold indebtedness increased, which has worsened with the recent increases in interest rates, they stressed.

In the official document, they documented that Mexicans who have more than 500 million pesos contribute 0.03% to total collection, and companies pay between 1 and 8% in taxes.

They estimate that a 5% tax on large fortunes could increase revenue by 270,000 million pesos, which would increase spending on health by 40% or multiply spending on the environment by 17.

This measure has already been applied in Argentina, Bolivia and Colombia.

According to them, in 2020, of every 100 pesos of wealth created in the country, 21 remained in the pocket of the 1% of the population, the richest in Mexico. And 40 cents remained for 50% of the population, who are the poorest.