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Latin America is often characterized as a low-tax region, but the level of taxation actually varies drastically from country to country. This article explores the especially striking contrast between Brazil and Mexico, two countries that share some key characteristics but nevertheless have dramatically different tax burdens. Brazilian tax revenues have averaged roughly 34% of gross domestic product in recent years, compared to less than 12% in Mexico. Existing theories of taxation, which emphasize contemporary economic and institutional structures, cannot adequately account for this difference. Only the "rentier state" literature sheds some light on it, and the explanation it provides is quite incomplete. I argue that the stark contrast in tax burdens between these two countries can be traced to contingent historical events that shaped in enduring ways elite views of the proper role of the state, as well as the political capacity of popular sectors to pressure for greater expenditure, thus necessitating higher tax revenues. In the Brazilian case I emphasize the country's uniquely smooth transition to independent nationhood, while in the case of Mexico I point to the impact of the revolution of 1910-1920 and the subsequent social, economic and political reforms, especially under President Lázaro Cárdenas. [ABSTRACT FROM AUTHOR]