Mexico City, Feb 16 (IANS/EFE) Mexico has passed a new law that allows citizens to deduct the payment of private school fees from their income tax.

The rule will apply to education ranging from pre-school to high school. Taxpayers will be able to deduct the amount spent on the studies of their children, parents or spouse, President Felipe Calderon said.

But the deduction is limited to the government's annual average per-pupil spending on public schools, anywhere from 12,900 pesos ($1,070) at the elementary level to nearly twice that for high school.

This is "a measure long awaited by thousands and thousands of families across the country who work hard every day to give their kids a good start in life," the president said.

Calderon said the cost of the deduction will be covered by "savings generated by the federal public administration" and added that its financing will not affect the "quality of public education" in the country.

The measure "will benefit more than three million children and young people" and will allow families to have additional funds for other necessary expenditures.

The initiative will also "influence the competitiveness and dynamism of the economy", he said.

The president said that between 2006 and 2011, the federal budget for education in Mexico increassed 40 percent to 531 billion pesos ($43.88 billion).