La Paz, BCS - Welcome to the Second Quarter, 2016 Newsletter. In this edition, we look at Mexico's economic relationship with the USA; take a trip to Uruapan, Michoacan; and check out Canada's new immigration law. In addition to the VISA regulation, Canada is seeking an increase of Mexican students for scholarships and an increase in temporary agricultural workers. We also describe The Settlement Company's rental property tax program and the obligation of paying taxes on rental property in Mexico.

Mexico-US Balance of Trade: Mexico Trade Gap Narrows in May
Source: Forbes Magazine

Mexico trade deficit narrowed by 52.6 percent year-on-year to USD 527 million in May of 2016 from a USD 1113.3 million gap a year earlier as exports rose, while imports fell. Considering the first five months of the year, exports decreased by 5 percent while imports dropped 2.9 percent.

Year-on-year, exports increased 0.3 percent to USD 31.3 billion as non oil shipments rose 2.6 percent mainly due to manufacturing (+2.4 percent) and agricultural goods (+8.5 percent) while mining goods fell (-10 percent). Imports went down by 1.6 percent to USD 31.9 billion due to lower purchases of intermediate goods (-0.8 percent), consumer goods (-4 percent) and capital goods (-4 percent).

Mexico's main exports are manufactured products (83 percent of total shipments) and oil and oil products (13 percent). Main imports are: metallic products, machinery and equipment (50% of total imports), mining products (13%) and chemical products (6.3%). Mexico's main trading partner is the United States (80 percent of total exports and 51 percent of imports). Others include: Canada, China and Japan.

Uruapan, Michoacán - Pearl on the Rio Cupatitzio (Part 1)

Uruapan, Michoacán was founded in 1547 by Fry Juan de San Miguel. The sixteenth century city results from the amalgamation of nine barrios. Today, there are six, since San Lorenzo dropped out many years ago. The barrios are; La Trinidad, San Francisco, San Juan Evangelista, San Pedro, Santa Maria Magdalena and San Miguel.

Each barrio has its own celebration with ceremonies, parades and gastronomical treats. During the celebrations of Semana Santa (Holy Week) each evening dancers perform in pre Hispanic costumes. Uruapan is 5,315 feet above sea level which results in a moderate climate. According to the 2010 census of INEGI (Mexico's Secretary of Geography and statistics) Uruapan has a population of 315,350. The many nearby villages push that figure to over a half million.

Attractions (In the city):

The Huatapera was originally called Hospital Real de la Purisma Concepcion. Established by Juan de San Miguel it is the first hospital constructed in the Americas. Today, it houses a display of traditional arts, crafts and historical items.

Mercado de Antojitos is the place to go in order to taste gastronomical delights of Michoacan. Located behind the Huatepero, you can enjoy such dishes as; atole, pozole, churundas and carnitas. Zucchini blossoms are used in soups during the season.

Café la Lucha has been serving coffee and pastries for nine decades from the same location. Go in one door and you will see a coffee shop with a Mexican flavor. In the other door you can order beans, whole or ground. At the back you can see beans, some from Michoacan being roasted.

Casa de La Cultura is across the pedestrian walkway from Café Lucha. It has said to be the oldest building in the community. Since its construction it has been a hospital a city hall and now the center for culture. During the year concerts are presented here and also exhibits of paintings, photography and crafts by local artisans.

The Main Plaza is known as the Plaza de Martires de Uruapan and is four blocks long. Music and dance concerts are presented in the "Pergola." During Semana Santa (Holy Week) the four block long plaza is the site for one of the largest exposition of artisans in Mexico.

Two important churches are located at each end of the street across from the main plaza. These are Inmaculada and San Francisco. The former has large statues on its roof. These were removed during the "Cristo War."

In the other you will see a large mural. It was painted in 1958 by the Persian muralist Schidell. Another of his works is in the Guitar library in Paracho a few miles outside the city. One of his students supervised the creation of a two story wall inside Corregidora 10. It is a private home.

Three Parks are located in the center of the city. La Rana is the smallest. It is named after the frog fountain located there. Although small the parks hosts many cultural events during the year. For special occasions the indigenous Purepecha people set up an outdoor restaurant and cook traditional dishes over wood fires. It is located at the opposite (one block long) end of Calle Corregidora from the Mercado de Antijito and in front of the library.

Barranca del Cupatitzio National Park (Parque Nacional), located in the center of Uruapan and is the second most visited park in Mexico. The Cupatitzio River rushes through the center and has numerous canals. The park features literally hundreds of waterfalls, some mad by man and most by nature. Water spurts out the lava rock on one bank of the river. It has a tremendous variety of flora and fauna, including a type of floribunda said to grow nowhere else in the world. The 450 hectare park was founded in 1938, after the land was bought by the government to create a recreation area.

Parque Lineal (Lineal Park) is the newest of the three having been opened a few years ago. It is a long narrow extension of the Parque Nacional. It too is rich in plant growth. If you walk to the end you will come out at Fabrica de San Pedro. This is an antique cotton mill that worked 24/7 during W.W.11 making material for parachutes and army uniforms. More recently foot weavers produced cloth for bed spreads, table cloths, napkins and other fine products.

Watch for Part 2, featuring Uruapan's many festivals and nearby (day trip) attractions.

If you go: Casa Serenity is a charming, historic spacious guest home in the center of the city. You can see it at casaserenity1.com. For more information: John.Glaab(at)settlement-co.com.

Canada to Lift Mexican Visa Requirements

The Government of Canada has made it a top priority to re-establish and strengthen our relationship with one of our most important partners, Mexico. On June 28, 2016, the Prime Minister, Justin Trudeau, announced Canada's intention to lift the visa requirement for Mexican visitors beginning December 1, 2016. The announcement came during a productive two-day State visit to Canada by Mexican President Enrique Peña Nieto. Read more »»

The Settlement Company® Rental Tax Payment Service

Under Mexican law, any income generated from properties located within Mexican territory are subject to taxation, even if the owners are foreigners and all funds are collected in accounts located outside Mexico.

For many years it has been a major issue for both Mexican tax authorities and individuals attempting to comply. For years a Federal Taxpayer ID was required to file and pay the tax. In order to obtain this tax ID one needed to be a resident of Mexico.

This was lose-lose for both the authorities and the foreigners who were willing to pay but baffled by the issues involved to "get legitimate." After more than five years of Settlement Company® dialogue with Mexican tax officials, a resolution was made in which the foreign property owner could appoint a Mexican company to pay his or her taxes and dispense with all other formalities.

This has become reality! Mexican authorities are now looking seriously to collect this long-neglected source of tax revenue and foreigners not only are lining up to pay but also to receive the receipts for payment of the taxes which can then be credited against taxes paid in their native country under the terms of the NAFTA treaty. Remember! no double taxation is permitted under the terms of the treaty! Learn more »»

News from AREA

Associated Realty of the Americas (AREA) is a small group of successful real estate practitioners spread across North America. There are 2 representatives of Mexico in AREA. They are Linda Neil (La Paz) & Jay West (Los Cabos). Linda has been appointed to the 2016 Advisory Board. Read more »»