United States (North America) and Mexico (Latin America) operate very different payroll systems, which makes a direct salary comparison interesting. On a $90,000 gross, the effective tax burden in United States is roughly 15.7% higher than in Mexico — driven by differences in FICA vs IMSS, bracket structure, and personal allowance.
Same nominal gross applied to both tax systems. Currencies aren't FX-converted — compare structures, not purchasing power.
Where each country wins on the same $90,000 gross — grouped into money, lifestyle, and protection.
$14,098 more per year on the benchmark gross.
15.7% lower effective rate at this salary level.
Top marginal rate 35% in Mexico — top-end effective rate stays lower than the alternative.
Higher net pay ($14,098 more / year) leaves more room to save once rent is paid.
7 income-tax bands vs 8.
Low rent pressure in major cities.
Basic public welfare and private healthcare reduce out-of-pocket family costs.
Basic public welfare with private healthcare.
Mandatory pension piece: IMSS.
On the same $90,000 gross, a worker takes home roughly $14,098 more per year in Mexico than in United States. That gap reflects the tax structure alone — before rent, healthcare, or savings behaviour come into play.
Housing is the first multiplier. United States has high rent pressure, while Mexico has low rent pressure. That means part of the higher take-home in Mexico can be absorbed by rent if you land in a major city.
Healthcare and pensions go in the opposite direction. United States runs a private healthcare model — Private, employer-tied insurance dominates; out-of-pocket costs can be significant. Mexico uses a mixed model — IMSS and ISSSTE for employees; private clinics widely used. The country with lower take-home often shifts costs that the other country leaves to your private budget.
Net-of-everything, a relocation decision should weigh basic public welfare in United States against basic public welfare in Mexico, plus differences in pension capture, social safety nets, and city-level cost of living.
A side-by-side read on what each country's salary actually buys after tax, rent, and savings room.
79% of gross becomes net.
95% of gross becomes net.
Major cities: high rent pressure.
Major cities: low rent pressure.
After deductions and typical rent, room to save is moderate.
After deductions and typical rent, room to save is strong.
Balance of take-home, rent, and public services in United States.
Balance of take-home, rent, and public services in Mexico.
Effective 20.6% at the benchmark salary.
Effective 4.9% at the benchmark salary.
FICA (Social Security + Medicare) at 7.6%.
IMSS at 3.0%.
Higher take-home ($14,098 more / year) and the ability to live in a lower-cost region of Mexico maximises disposable income.
Mexico keeps a lighter tax structure, which usually offsets the private healthcare and housing setup that expats face anywhere.
Basic public welfare and private healthcare in United States reduce private spending on childcare, schooling, and medical care.
Top-end effective rate stays lower in Mexico. The bracket structure and any social-contribution cap keep more of every extra dollar at the top of the pay scale.
United States provides basic public welfare and private healthcare, which matters most when disposable income is tight.
For a single worker on the benchmark gross, take-home pay is higher in Mexico — and without dependents, the value of public welfare matters less.
| Topic | 🇺🇸 United States | 🇲🇽 Mexico |
|---|---|---|
| Tax system | Federal + state + local taxes; state can swing effective rates by 10+ points. | 11-band ISR + small employee IMSS share; employer carries most payroll cost. |
| Healthcare | Private, employer-tied insurance dominates; out-of-pocket costs can be significant. | IMSS and ISSSTE for employees; private clinics widely used. |
| Pension | 401(k) is opt-in; Social Security replaces a modest share of pre-retirement income. | Afore individual retirement accounts; payouts are modest. |
| Housing market | Wide variance — coastal metros are very expensive, inland cities far cheaper. | Mexico City and Monterrey are rising; most of Mexico stays cheap. |
The US uses a seven-bracket federal income tax on top of a 7.65% FICA payroll tax (Social Security + Medicare). State income taxes — ranging from 0% in places like Texas and Florida to over 13% in California — are not included in this estimate. Most workers also see additional deductions for 401(k), health insurance, and HSA contributions.
Mexico's ISR income tax uses an 11-band sliding scale with a top rate of 35%. Employee IMSS social contributions are modest (~3%); the employer covers the lion's share. A subsidio para el empleo helps low earners. State payroll taxes are charged to the employer, not the worker.
Pre-calculated breakdowns at common pay levels in United States — open either side for the full page.
Last updated: 2026. Estimates only — see the disclaimer above.