Mexico’s Secretariat of Finance and Public Credit (SHCP) recently presented the 2026 Economic Package to the Congress of the Union. The initiative proposes a dramatic increase in gambling taxes on both online and land-based casinos. If the economic reform package takes effect, it would make Mexico one of the highest-taxed jurisdictions globally.
Mexico Plans Higher Tax on Gambling GGR: Quick Summary
- Mexico’s Finance Minister Édgar Amador Zamora has proposed raising taxes on gambling GGR as part of the nation’s 2026 Economic Package. The proposal aims to amend the Special Tax on Production and Services (IEPS) on gambling GGR to 50%, up from the existing 30%.
- The amended gambling tax would generate additional revenue and help offset the fiscal deficit from 2025. Public debt is expected to rise to 52.3% of national GDP, while the fiscal deficit is projected to be at 4.1% of the GDP. The finance minister is expecting tax collections of MX$5.8 trillion (approximately €268 billion).
- The Chamber of Deputies have until October 20 to approve the amended budget. The Congress of the Union will then review the Revenue Law and finalise the Expenditure Budget by November 15. Once approved, the budget will be made public within 20 days.
Higher Taxes Proposed on All Forms of Gambling
Mexico applies the Special Tax on Production and Services (IEPS) on goods and services deemed “socially risky”. This includes all forms of gambling, video games containing violence, and products such as soft drinks, cigarettes, and gasoline. These products attract IEPS in addition to standard VAT.
Mexico’s Finance Minister Édgar Amador Zamora proposes reforms to the existing tax structure in the 2026 Economic Package. Officially presented by the Secretariat of Finance and Public Credit (SHCP) to the Congress of the Union, according to the SHCP’s press release on September 8, the economic package prioritises social responsibility.
The 2026 economic reform bill is extra-fiscal in nature, meaning it influences public consumption patterns while generating revenue. Its highlights include raising gambling taxes to 50%, introducing an 8% IEPS tax on tobacco, sugary beverages, and video games with adult content, including nudity and violence, not suitable for viewers under 18.
The additional tax revenue could allow Mexico to reduce its fiscal deficit to a projected 4.1% while public debt is expected to reach 52.3% of GDP in 2026. The finance ministry aims to raise MX$5.8 trillion (approximately €268 billion) in taxes, with projected revenue crossing MX$8.7 trillion (approximately €402 billion) in 2026.
The proposal will be heard at the Chamber of Deputies, which has until October 20 to debate and approve it. The Congress of the Union then has to review the Revenue Law by October 31 and finalise the Expenditure Budget by November 15. If approved, the budget will be publicly announced within 20 days.
Probable Tax Hike Causes Concern Among Industry Stakeholders
The probability of the sharp tax hike has caused concern among industry stakeholders who already pay 30% corporate tax on top of the proposed 50% IEPS levy. Several jurisdictions within Mexico also impose local taxes, which operators can use to offset up to 20% of IEPS payments. However, raising the IEPS rate to 50% would create additional pressure.
The proposed tax hike comes at a time when Mexico plans to revamp its online gambling infrastructure. As online gambling continues to surge, authorities expect revenue from the sector to surpass that of land-based casinos for the first time in 2025. This highlights the shifting trend toward digital gambling and the need for market regulation.
Mexico isn’t the first nation to contemplate raising gambling taxes to offset a deficit budget. Earlier in July, the UK government proposed higher gambling taxes to compensate for a £30 billion deficit.
Other countries have also implemented the idea, including Romania, which increased gambling taxes on land-based and remote operators earlier this year.
While larger operators have the financial flexibility to absorb the higher tax rate, smaller companies will feel the heat. This can lead to a handful of dominant firms gaining control over a majority of the market share. Operators and trade associations are yet to respond to the anticipated tax hike.
Experts are concerned that rising tax obligations will force players to choose unregulated gambling operators over licensed platforms. This can make it more difficult for players to avoid online casino scams, leave the government with less control over the industry, cause public safety concerns, and reduce profit margins.