Mexico Advances Plan to Raise Gambling Tax From 30% to 50%
Mexico’s Senate committee has approved a fiscal proposal that would lift gambling taxes from 30% to 50% and add a new levy on violent video games.
LISTEN TO THIS ARTICLE:On Tuesday, the Senate Committee on Legislative Studies endorsed the 2026 Miscellaneous Fiscal Package, a central element of President Claudia Sheinbaum’s 2026 economic plan. The measure would increase the tax on betting and online casino operations to 50% from the current 30% and introduce an 8% Special Tax on Production and Services (IEPS) for video games deemed to contain violent content. If the legislation clears the full Senate and is not amended, it is scheduled for publication in the Official Gazette of the Federation and would take effect on January 1, 2026.
The Chamber of Deputies approved the proposal earlier this month, and lawmakers now face a deadline of October 31 to complete Senate deliberations and a plenary vote. Proponents say the changes are aimed at shoring up public finances and mitigating health and social harms associated with gambling and other taxed goods such as tobacco and sugary drinks.
Committee members framed the increases as part of the state’s constitutional duty to protect public health and to channel revenue into services. Officials told colleagues that a portion of the proceeds would be earmarked for hospital funding, preventive education programs and broader public-health initiatives. The government also cited the need to reduce a projected fiscal shortfall – estimated at around 4.1% of gross domestic product – by widening tax bases on activities considered socially harmful.
Another stated objective is to tighten the regulation of online betting and gaming. Lawmakers argued that many foreign-based operators currently extract profits from Mexico without adequate tax contributions, and that higher levies must be paired with stronger enforcement to prevent revenue leakage.
Related: New ‘Sin Tax’ on Gambling in Mexico Could Push Tax Rate to 50%
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Industry Reaction and Fiscal Impact
Industry participants have voiced strong opposition to the proposed rates, warning the jump to 50% could incentivize informal markets, accelerate license attrition and reduce overall wagering volumes. Some operators argue that such a rate would leave little room for legal platforms to compete with unregulated offshore sites.
“A sudden effective tax rate of this scale risks shrinking the taxable base rather than enlarging it”, said Dr. Ana Rivera, a public policy economist at El Colegio de México. “Higher rates can change consumer behaviour and market structure; unless paired with robust enforcement and a clear transition plan, the policy could deliver less revenue than anticipated while increasing social costs in other areas.”
Trade groups and casino operators also cautioned on jobs and investment. “This proposal will raise compliance costs and could discourage domestic and foreign investment in the sector”, said Mariana López, public affairs director at the Mexican iGaming Association. “If the goal is to protect public health and raise funds for hospitals and prevention programs, the authorities should set out targeted measures for problem gambling and a transparent revenue allocation framework.”
Fiscal analysts note comparable jurisdictions have taken divergent paths: some raised levies and tightened licensing, while others combined moderate tax increases with regulatory incentives to keep operators in the formal economy. The government’s next task will be balancing the revenue target with enforcement capacity and the risks of market displacement.
With a tight calendar ahead of the October 31 deadline, stakeholders from hospitals to operators are preparing submissions and briefings. The senate plenary debate will be closely watched by investors, regional regulators and international gaming companies with exposure to the Mexican market.
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