Mexico Agrees to Phased-in Rollout of Lowered Cruise Passenger Head Tax

After pressure from the cruise industry and concerns raised by local government in the states where cruises contribute to the economy, Mexico’s federal government has reportedly agreed to a lower amount and phased-in rollout to the hefty head tax planned for cruise passengers. News of an agreement is in the Mexican press after intense negotiations that started in December while the implementation was delayed for six months. 

Citing the need to support the Mexican economy and for port development, the federal government announced in late 2024 that it would end an exemption for cruise passengers of the head tax charged to short-stay tourists known as a Non-Resident Duty. The fee was to be set at $42 per passenger as of January 1, 2025, with the potential of higher costs when the local port taxes were also factored into the cost.

The cruise industry complained saying that Mexico was jeopardizing the long-standing relationship and its economy with the costs. The government relented announcing a six-month delay till July 1, giving the industry time to adjust. At the same time, the negotiations began seeking a compromise with the industry. In April, it was reported that the Florida-Caribbean Cruise Association was working hard to strike a compromise.

Mexican media reports indicate that the deal was struck so that the head tax will begin in July at $5 per person for the next 13 months. From August 2026 through July 2027, it will step up to $10 per person and then $15 in 2027-2028. As of November 2028, it will increase to $21 per passenger.

The reports said the intervention of the governor of the Quintana Roo state Mara Lezama was instrumental in reaching the compromise. Her state is home to the popular ports of Cozumel and Playa del Carmen and derives significant income from the cruise industry.

The cruise lines have also agreed to promote port infrastructure projects including the proposed fourth pier in Cozumel. They will also seek to increase the number of cruise passengers they bring to the Mexican ports and will promote Mexican goods aboard their ships. They will also increase the acquisition of supplies in Mexico.

Federal Tourism Secretary Josefina Rodriguez is reported to have called the agreement a major step to contribute to Mexico’s economic development.

The cruise industry executives speaking at the Seatrade Cruise Conference in April called for greater collaboration with ports around the world and said they hoped ports would discuss concerns with them. They cite the potential for collaboration while ports and popular destinations struggle with the influx of passengers and the impact of over-tourism. As cruise ships increase in size and capacity, many destinations are looking for ways to balance cruise passengers with onshore tourism and maintain the environment for residents.

The reports from Mexico said a joint announcement of the agreement will be released in the coming days.