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Small Retailers Warn Sales Will Slide as Mexico’s 2026 IEPS Hike Targets Sodas and Cigarettes

Trade groups warn higher levies could fuel illicit cigarette sales.

Overview

  • The approved IEPS changes take effect January 1, 2026, lifting the sugary‑drink tax from 1.6451 to 3.0818 pesos per liter, adding a 1.5‑peso charge on light or zero‑calorie versions, and phasing cigarette taxation toward 200% over five years.
  • ConComercioPequeño says lawmakers ignored business input and warns corner stores will be harmed, citing criminal pressure on shops in Coahuila, Nuevo León and Tamaulipas to sell illegal cigarette brands.
  • Illicit cigarette consumption grew from 8.5% to 20.4% of the market between 2017 and 2023, and business groups caution the new taxes could accelerate contraband sales.
  • ANPEC projects about a 15% monthly sales decline and risk to roughly 65,000 newer shops that rely on sodas and cigarettes to drive foot traffic and that cannot stockpile or absorb price increases.
  • Officials defend the policy as a healthy tax intended to curb chronic disease and bolster public health funding.