On the 22nd of December, Decree No. 361 was published in the Official Gazette of the State of Baja California, amending several articles of the Tax Law of the State of Baja California (the "Law"). Among the reforms made, the increase of the PLITR rate stands out.

The purpose of the PLITR is to tax expenditures for the remuneration of personal work under the direction or dependence of a third party, rendered within the territory of the State. Now, by means of the amendment to the Law, a rate of 4.25% to the PLITR was established. Prior to this amendment, article 151-16 of the Law established that the rate would be determined by the State Revenue Law, and for many years it was maintained at a rate of 1.80%.

It should be noted that this increase is unjustified and disproportionate, in addition to the fact that there are several precedents of "surcharges" to the PLITR that were declared unconstitutional in past fiscal years, precisely because they had no justification; these surcharges ranged from 1.20% to 1.25%.

Therefore, our perception is that, in order to prevent the "surcharges" from being declared unconstitutional again, the amendment of the Law intends to increase the PLITR to a single rate. This would be unconstitutional, which is why we see solid elements to challenge the reform to the Law, by means of a constitutional process.

In this regard, there is a maximum term of fifteen (15) business days to file a constitutional process, which begins to run after the first act of application of the rule.

Therefore, the fifteen (15) days would begin to be computed as from the filing of the quarterly return, for taxpayers with up to twenty-five (25) workers; such return must be filed no later than April 25, 2024.

For the rest of the taxpayers, the term begins to be computed as from the filing of the monthly tax return, which must be filed no later than25 February 2024.