Mexico proposes gambling tax hike from 30% to 50% of GGR
Summary
Mexico’s finance minister, Édgar Amador, has proposed a sharp increase in the Special Tax on Production and Services (IEPS) for gambling and lottery games as part of the 2026 Economic Package. The IEPS rate on gross gaming revenue (GGR) would rise from the current 30% to 50%, applying to both land-based casinos and online platforms, including foreign operators without Mexican tax residence.
The package also introduces an 8% IEPS on video games with violent or adult content and is framed as a set of “healthy taxes” aimed at discouraging risky consumption while boosting fiscal revenue to reduce the budget deficit.
Key Points
- The IEPS gambling rate would increase from 30% to 50% of GGR, affecting casinos and online operators alike.
- Foreign operators without Mexican tax residency would be included in the tax scope.
- An 8% IEPS on violent/adult video games (physical and digital, including in‑game purchases) is also proposed.
- The Finance Ministry projects total revenue of MX$8.7tn for 2026 with tax collections at MX$5.8tn; fiscal deficit forecast at 4.1% of GDP.
- Legislative timetable: Chamber of Deputies debate by 20 Oct; Senate review by 31 Oct; Expenditure Budget finalised by 15 Nov; publication within 20 days after approval.
- Operators already face high tax burdens: 30% corporate income tax (ISR), state/local levies, regulatory fees and additional consumption taxes in some jurisdictions.
- Online gaming revenue is expected to outpace land-based revenue by end of 2025, even as regulation remains largely based on a 1947 law and modernisation is slow.
Context and relevance
This proposed hike comes amid wider fiscal pressures on the Mexican government and forms part of a broader move towards so-called “healthy taxes.” For the iGaming and casino sector the change would materially increase operating costs and could reshape market strategy: higher effective taxation may reduce operator margins, slow market entry, or drive consolidation. Trade groups and operators are already coordinating responses.
The change is significant because it targets both domestic and foreign digital operators, at a moment when online revenue is rapidly growing and the industry is awaiting modernised regulation. The proposal could also influence cross-border investment decisions and pricing in Latin America’s gambling market.
Why should I read this?
Short version: if you work in LatAm iGaming, run payments, invest in casino operators or sell B2B services here — this could hit revenues hard. It’s a big, immediate squeeze on margins and will affect pricing, licensing strategy and dealmaking. We read it so you don’t have to — here’s what matters and what to watch next.
Source
Source: https://next.io/news/regulation/mexico-proposes-gambling-tax-increase/