Samsung Electronics, one of the world’s largest technology companies, is facing a financial crisis in Mexico that could force it to halt operations in the country. A massive tax dispute with Mexico’s Tax Administration Service (SAT), valued at more than 300 billion pesos, has sent shockwaves through the nation’s manufacturing sector and raised fears about the future of foreign investment.
The Dispute: IMMEX Program Under Fire
A Financial Threat Beyond Samsung
Political and Economic Stakes for Mexico
A Defining Moment for Mexico’s Business Future
At the center of the conflict is Mexico’s IMMEX program, a long-standing initiative designed to attract foreign investment by allowing manufacturers to import raw materials and components tax-free — as long as the final products are exported.
The controversy lies in a mechanism known as “virtual imports,” which permits goods to be sold within Mexico without paying additional VAT. According to the SAT, this practice has been abused to avoid paying taxes, resulting in estimated losses of up to 250 billion pesos per year, as stated by Supreme Court Minister Lenia Batres Guadarrama.
However, other legal experts — including Minister Yasmín Esquivel Mossa — argue that the SAT’s interpretation amounts to double taxation, which would violate Mexico’s constitutional tax principles.
The dispute reached the Supreme Court of Justice (SCJN) in April 2025, but the ruling was postponed, leaving Samsung Mexico, led by Thomas Yun, and hundreds of other companies in a state of legal limbo.
The lawsuit against Samsung, which exceeds 300 billion pesos including fines and interest, equals roughly six years of the company’s profits in Mexico. Industry observers warn that a Supreme Court decision favoring the SAT could have a ripple effect across the nation’s economy.
The IMMEX program accounts for over 60% of Mexico’s manufacturing exports, worth more than $300 billion in 2024, according to the Ministry of Economy. Key industries — such as automotive, electronics, and aerospace — rely heavily on this framework to stay competitive in global markets.
If the court upholds the SAT’s position, analysts warn of a potential exodus of foreign investment. U.S. and Canadian firms protected under the USMCA trade agreement could argue that Mexico is breaching principles of equal treatment, potentially triggering trade disputes and undermining investor confidence.
Samsung is one of Mexico’s largest employers and exporters in the electronics sector. Any withdrawal from the country could disrupt supply chains for consumer electronics, home appliances, and smart devices. Insiders suggest that the company is already exploring relocation options in other Latin American nations with more predictable tax environments.
The standoff has evolved from a tax issue into a broader political and institutional test for Mexico. The Supreme Court must now strike a balance between curbing tax evasion and maintaining investor confidence — a decision that will likely shape the country’s business climate for years to come.
The case also comes at a crucial time for Mexico’s ambitions to position itself as a hub for nearshoring, as global companies seek to relocate supply chains closer to the United States. A ruling perceived as hostile to foreign investors could undermine that momentum, slowing job creation and economic growth.
For Samsung, the situation presents a stark choice: pay a crippling fine that could threaten its Mexican operations or exit the country entirely. For the government, the challenge is to uphold fiscal discipline without scaring away the multinational companies that power its industrial economy.
The Supreme Court’s upcoming ruling will not only determine Samsung’s fate but also define Mexico’s global fiscal reputation. The decision will reveal whether the IMMEX program remains a cornerstone of economic growth or becomes a symbol of regulatory uncertainty.
In the months ahead, both Mexico and the international business community will be watching closely — as the outcome could redefine the balance between tax enforcement and economic competitiveness across Latin America.
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