New-York tribune., 1919-05-06
Says Mexico viii
increase Taxes
On Oil Properties
Mexican Legal Authority
Holds Government Justi-
fed in Its Programme of
Adding to Industry Levy
Financial Bureau

Special Correspondence
MONTEREY, Mexico, May 5.-Ameri-
can and other foreign oil investors in
Mexico will obtain no favorable legis-
lation at the hands of the Mexican Con-
gress, which convened in the capital on
May /. This is the expressed belief
of men who are in close touch with the
Carranza administration and the senti-
ment that exists in official circles.
Widespread propaganda is now being
circulated in Mexico with the view of
lustifying the governments attitude
toward the oil industry Emeterio de
la Garza, jr., a distinguished lawyer,
of the City of Mexico, who in former
times was attorney for large foreign
oil interests in this country, is now
openly supporting the programme of
Carranza of increasing the taxes on
the industry. In q public statement,
jus. issued, Mr.. Garza says:
The laws governing and taxing the
oil lands and the oil productions in
Mexico have lately been discussed so
much through the press of the United
States and in Mexico as well that I
which is to be submitted at this time,
as proof of good faith to Congress,
for ample final consideration, except
to present few facts which will
speak for themselves.
The value Of oil exported during
the year 1918 by all of the oil com
panies operating in Mexico was 15O,-
100000 pesos, equivalent to $4,000, 900
gold. The taxes paid by these COM
panies amounted to 11,12O.39 80 pesos,
or little less than per cent.
!
taxes amounting to 6,S54,53 pesos,
equivalent to y $40 per cent. We
must take into consideration the fact
that the expectation Of oil in 1918 was
only 1881, ,242,317 tons more than in
1871 notwithstanding the fact that,
due to the high price of oil, the COM
panles received three times as much as
the amount of money collected for oil
in 1917.
During the period Of 1917 to 1918
the government of Mexico reduced the
taxes from II $40 per cent to $40
per cent, one-third less, in spite of the
fact that the earnings of the companies
increased considerably.
I'm 1918 $50 per cent. of the total
amount of oil exported was crude oil
and 34.1 per cent was refined oil. The
largest amount of this, 1.10S, ,O42, ,473
tons, belonged to the Hausteca Petro-
leum Company and 577,593.305 tons to
the Compania Mexicana de Petroleo
del Aguila.
Official records show that the oil
companies Of Mexico have been stead
lily and continuously increasing the
production of oil, the profits received
and the dividends paid to their stock
holders being sometimes as high as 23
per cent.
Now, in regard to rent, an oil lot
of ITO acres GA hectares) will cost in
Mexico $500 year, or S4,160 in period
of thirteen years from 1918 to 1881
adding to that sum S102, which is the
title tax. the to tal rent of such lot in
Mexico would be $4,352 for even the
largest producing lot, es against S227,
600 to be paid in Oklahoma on the
example cited.
"In the state of Texas those who
obtain oil lands have to pay So per
acre year, one-eighth of the value
Of the oil prod ced and one-tenth Of
the gas conserved, which is obviously
greatly in excess Of taxes which obtain
in Mexico"