Securitization of federal tax participations by Mexican states and municipalities By Juan J. Flores, associate, and Jose Ramn Tora, director, Latin American Structured Finance Ratings Group, Standard & Poor's.

Asset Securitization Report | May 28, 2001 | Copyright

In recent months, several Mexican state and municipal governments have considered the possibility of funding themselves by issuing debt in the Mexican local capital markets. Such debt issuances would be secured by tax revenues, collected by the Mexican federal government, and redistributed to the states and municipalities through the federal revenue-sharing system. Funds from this revenue-sharing system are known as tax participations and are made up of the flows coming from the General Participation Sharing Fund (GPSF) of the "Rubro 28," a section of the Federation budget.

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