Taxes affect purchasing habits

According to the report, the five categories with the highest price growth compared to December 2013 are: soft drinks, snacks, sweet bread, juices and cereals. According to INEGI, the consumer confidence index fell again at the beginning of the year, reaching 84.5 (the same level as in May 2010). Within that, the part that has declined the most is confidence in the country’s economic future, because Mexicans do not see this scenario changing significantly and positively.

Another interesting element to analyze is that there was a high level of inflation (0.9%), driven by the tax change. Finally, the self-service activity should be highlighted, the figures for this month are not very encouraging (reported by ANTAD). In short, we do not see a clear scenario for the country’s economic recovery.

When analyzing information collected by Kantar Worldpanel México, it was found that the self-service channel is losing weight in household shopping, and the traditional channel is gaining in almost all baskets that were audited. It is worth mentioning that the cards show a slight decline, and the frequency of purchases shows a small increase.

Fabián Ghirardelly, Regional Director of Kantar Worldpanel Mexico, explained: “In terms of comparing taxable versus non-taxed categories, there are no changes in the last month of January. 25.3% of household consumption in January 2014 was allocated to taxed categories (practically the same figure as last year ).If the reform tried to make the population buy less of these products, today this is not reflected in the market. Prices among the taxed categories increased by 12.7% when comparing their prices with December 2013. This effect was largely driven sweet drinks“.

Three large groups of categories affected by the new taxes were analyzed: sugary drinks, high-calorie foods and pet food. A very clear increase in prices can be observed in the case of sweet drinks, but not so pronounced in the case of high-calorie foods. Their prices are higher than a year ago, but the expected increase due to the reform is not necessarily reflected.

The five categories with the highest price growth compared to December 2013 are: refreshments, snacks, sweet bread, juices and cereals. Two of them lose their average purchase and reach levels lower than January 2013, such as soft drinks and juices. So, although it can be seen that there are no major changes in the total number of taxed categories, a greater impact is evident in certain categories.

Source: www.kantarworldpanel.com/mx


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