Reciprocity, anyone?

I generally avoid issues relating to my wife's work; it's a good way to get her in trouble. This is more of a general political-diplomatic issue, so, with her caveat that she's not allowed to post such things, I'm going to rant a bit.

First off, a brief explanation of the IVA tax. It's a value-added tax (VAT); details here. The tax doesn't apply to everything, so it doesn't help with much of the food cost or medicine, but it does apply to imported items and luxuries. If you go to a nice restaurant and order drinks, you will be paying IVA. If you have a sizable group of folks at a happy hour or a farewell dinner, the IVA can add up to a sizable amount.

American diplomats in Mexico are entitled to a refund of the IVA tax. Sounds great, right? There's just one problem: lots of hoops! First off, you can't apply for a refund on any purchase less than US $50. Some stores and the Pemex gas stations allow you to combine receipts obtained within a month into a single "factura" (tax statement/receipt) and meet the $50 minimum. (Telmex, the monopoly phone company, and Pemex also don't have to hit the $50 limit for filing.) If you miss that target amount, even if it's only by a few pennies due to the fluctuating currency valuation, you get nothing back.

So, you have some qualifying receipts - what next? Well, first there's a deadline: you must submit within 90 days (60 days is advised for us, since we have to ship our stuff to the Embassy - does it really take 30 days to travel there???) of the date on the receipt. Second, there's a form and procedures: fill out the spreadsheet, print it out, sign it, tape (not staple) each factura and accompanying receipt to a plain sheet of white paper, sign that, too, group the receipt/factura bundle with the spreadsheet, put it in an envelope, and send it to the US Embassy in Mexico City. At some point in the future, you'll get a refund. When? Who knows? (Turnaround has been several months for us.)

If you make a mistake on any part of the rules, you have probably lost any chance of getting your refund. Some of you may say, "but at least you're getting a refund!" True, but let's look at how Mexican diplomats are treated in the United States. A Mexican diplomat is presented with a tax exemption card. No sales taxes are charged on purchases made with this card. No muss, no fuss, no taxes.

Meanwhile the Mexican government decided to encourage tourists to visit Mexico by (wait for it) refunding the IVA tax at handy kiosks in airports. The story doesn't give all the relevant details, but here's a great little quote:

"Of the money they can claim back at airports, tourists will be able to get half in cash pesos, up to a maximum of 10,000 pesos ($955). The rest will be credited to their bank accounts or credit cards within 40 days."

Immediately?! Within 40 days?! Gee, do you think they'd mind if US diplomats started queuing up at these kiosks? According to our own government's web site, we're supposed to receive reciprocity; obviously we are not. The Mexican government is clearly more concerned with the happiness of US tourists than US diplomats. Perhaps it's time to write my representatives and complain about this specific issue or start a petition.