Mexican president issues tax cuts for areas along US border

Mexican President Andrés Manuel López Obrador issued an executive order on Monday lowering taxes in municipalities along the U.S.-Mexico border, Reuters reported.

López Obrador argued that the move would spur economic growth, make Mexican business more competitive with U.S. counterparts across the border and encourage residents to live and work in northern Mexico rather than migrate to the U.S.

{mosads}The tax cuts will apply to businesses in the northern region of the country. Reuters reported that López Obrador said on Saturday that the minimum wage in the same northern municipalities would rise starting Jan. 1 to nearly double the national rate.

“This is a very important project to boost investment and job creation,” López Obrador said of the initiative, according to Reuters.

The tax cuts are expected to cost the Mexican government billions in revenue, Reuters reported. 

López Obrador, who was sworn in earlier this month, has expressed optimism he will be able to work with the Trump administration, even as President Trump has threatened to shutter the border between the two countries as part of a crackdown on immigration.

Trump in recent days has dug in on his demands for funding for his proposed wall along the U.S.-Mexico border. The clash between Trump and Democrats over border wall funding has led to a partial government shutdown that has lasted 10 days and counting.

The president originally pledged that Mexico would pay for the border wall, though the Mexican government has repeatedly denied it would provide the money.

Trump on Friday threatened to “close the Southern Border entirely” if Democrats do not give into his funding demands. He previously made a similar threat as a caravan of Central American migrants approached the U.S. earlier this year.