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Mexican customs charge dive travellers sales tax on their equipment

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Mexican customs charge dive travellers sales tax on their equipment

Wed, 22/12/2021 - 16:36
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Underwater photographers who bring their professional-grade camera equipment and housings into Mexico are at risk of being charged Mexican sales tax (19%) on the value of their personal equipment when passing through customs. The underlying policy is obscure, appears to be arbitrarily applied, and Cabo San Lucas, where the bulk of Mexican liveaboards berth, seems to be the most affected point of entry.

When it comes to must-see dive destinations, Mexico’s Socorro Islands tops many a diver’s wish list. Boasting up-close encounters with giant Pacific manta rays, dolphins, sharks and immense numbers of fish, the diving presents incredible encounters and surprises galore.

However, if you are an underwater photographer with lots of gear, you may get a surprise of an unwanted variety: paying duty on your own equipment.

My own case story

I had the opportunity to visit Socorro in November 2021, and the diving was everything I had hoped for and more. Just getting there proved to be the challenge. Flying to San Jose de Cabos from my home in Toronto necessitated a brief layover in Calgary. Too brief as it turned out; I made the connecting flight, but my bags did not.

Fortunately, I had arrived a day before the liveaboard departure, and my bags arrived the following day. I decided to go to the airport to pick them up and then head straight to the marina. My liveaboard, the Solmar V, kindly delayed departure so I could do so. So far, so good…

After my flight landed, a WestJet agent took me to the arrival hall where my bags were waiting. We then headed to the customs hall, where she explained my situation to the customs agent. I was then told to put my bags through the X-ray machine. I was then told to open the bag with my underwater equipment. The agent then explained that I was only allowed to bring in one housing. I was in utter disbelief. He then asked what the value was.

Both housings are Seacam, with one purchased earlier this year and the other being five years old. When I told the agent the value, he informed me that I would need an import broker to bring them into the country. My jaw dropped further. “You can’t be serious?” I exclaimed. “These are my own personal items!”

Charged US$570

With the clock ticking and departure looming, I had no time to argue. They had me and they knew it. Not wanting to risk further delay, I had no choice but to pay US$570 in duty. The payment was to be made by credit card only, no cash. To add insult to injury, the payment did not go through, as the terminal did not work.

After seven attempts, the agent left to find a terminal that worked. I sat there waiting for 20 minutes, frantically sending texts to Pacific Fleet to update my situation. Finally, he came back, and I was able to pay. After stamping the receipt, I was told it would be good for a year. I literally ran out the door, grabbed my bags and headed for the marina.

Once aboard the Solmar V, I told the other passengers what happened. Several had heard of similar occurrences happening in Cabo. In the 19 years I have done underwater photography, I have travelled to 25 countries and territories and have never had anything like this happen before. On a recent trip to Egypt, my bags were X-rayed and opened, but all they cared about was whether I had a drone. (I did not).

Just what is going on here?

It seems the rules are vague or ambiguous. If that is indeed the case, it leaves the door wide open to interpretation and arbitrary handling. Consequently, nobody can be sure of what applies. The entire process is random and unexpected. However, it seems the mere sight of a Pelican case is enough to warrant an X-ray.

Since my return, I have researched the matter further and have discovered my experience was not an isolated incident. It did not take many inquiries within the community of established underwater photographers before one story after the other came to light. The emerging case stories came from several personal acquaintances, a couple of big names, a well-known underwater camera store and a travel agent, all of which had quite similar experiences to relate—of being taken completely by surprise and forced to part with a significant amount of money on the spot. These cases stories also happened primarily in Cabo.

Apparently, border agents view a certain amount or value of equipment as "professional," which you are not allowed to bring in freely. Or, they are concerned about grey imports—that is, bringing in equipment to sell, or if you act as a courier for somebody else.

At the time of going to press, we have not been able to ascertain the true nature of this fee—whether it is a duty, sales tax or something else. It would be nice to see some official documents and be able to study their exact wording, i.e. to determine where exactly the limits go, regarding what is permissible to bring into Mexico.

The magazine will continue to search for the relevant documentation and is in the process of seeking comment and clarification from the Mexican authorities. We will share this information when, or if, it comes to light.

Meanwhile, several secondary sources have referred to the fee as being sales tax (VAT). But if that is the case, the fees should be refunded upon re-export, when you go home bringing the same equipment with you. But this does not seem to be the case, or at least, it has not been offered. If it is some other sort of duty being charged, why not give a refund upon departure anyway? Whatever the underlying nature of the fee charged, there surely are a couple of better ways to address the mentioned concern—unless the real underlying agenda is to fleece some tourists who may be perceived as wealthy. 

Image
Mexican customs receipt

Concerns over imports

Some countries do have concerns about the importation of cameras and equipment. In many cases, however, all that is required is registration of serial numbers beforehand, so border authorities can check that you leave with the gear you brought in.

Preempting the problem

One solution is an ATA Carnet. Established by the World Customs Organization (WCO) in 1961 to facilitate world trade, it is an internationally recognized customs document for the temporary importation of goods: “The ATA Carnet is an international customs document that allows the holder to temporarily (up to one year) import goods without payment of normally applicable duties and taxes, including value-added taxes. The Carnet eliminates the need to purchase temporary import bonds. So long as the goods are re-exported within the allotted time frame, no duties or taxes are due. Mexico accepts the ATA Carnet in all of its entry points."

Obtaining a Carnet, which you can do from various local or online services, comes with its own fee, but this is much smaller than the duties you risk having to pay and surely will spare you a stressful experience upon arrival.

Bad idea to alienate tourists

With tourism hit hard by the pandemic, one would think a country would do everything possible to entice visitors, not dissuade them. This so-called “policy” is plainly absurd, as it aggravates tourists and gives them a very bad experience. For some, it is enough to dissuade them from ever returning. Ultimately, what is the point of angering customers and making life difficult for one's tourism industry? 

What makes it doubly ludicrous is that many would likely have spent the money on something else within the country. The money for the import duty is coming out of their holiday budget or savings, leaving less to spend on purchases, restaurants or entertainment. In dive circles, it is giving the entire country a bad name, and underwater photographers and divers spend big money on dive trips, especially to remote locations like Socorro.

At the very least, liveaboards operating out of Cabo need to warn customers of this practice at the time of booking. We reached out to Solmar V (Pacific Fleet), Nautilus and Rocio del Mar / Quino El Guardian for comment. We did not receive any clarification from the first two before this issue went to press, but we will provide an update when, or if, we do. Meanwhile, Rocio del Mar / Quino El Guardian stated that they were familiar with the issue and even have a post on their website addressing the issue but were not aware of any of their customers ever being affected.

I enjoyed Mexico very much and would love to return. However, if this means paying another US$570, then sorry, I’ll pass. For photographers going through Cabo, be warned: You may get waived through customs, but that random X-ray may lighten your wallet.

 

 

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