This paper analyses two efforts of the Mexican Federal Government to implement a tax reform. The first was made by the Echeverría administration (1970–6). The second is currently taking place under the Salinas government, in office since December 1988.
My aim is to understand what economic, ideological and political conditions give rise to a successful tax reform. I will focus on government relations with business, in particular with big business; and on the nature of the proposed tax reforms (each of which had different distributional costs). The question is how these factors affected the outcome of the two reforms. While Echeverría's progressive reform was subsequently replaced by an increase in tax rates, the second, that of Salinas, has, so far, been successful.