Mexico Inches Closer to Raising Gambling Tax from 30% to 50%

Mexico’s Senate Committee on Legislative Studies has approved the 2026 Miscellaneous Fiscal Package, which includes a significant hike in taxes on betting and gaming activities. With this move, the country moves closer to accepting part of the President Claudia Sheinbaum administration’s 2026 economic plan, which will see a tax increase on betting and online casino operations from 30% to 50%. 

Mexico Is One Step Closer to a Substantial Gambling Tax Increase

Lawmakers stated that the new tax rates are designed not only to strengthen public finances but also to discourage socially harmful behaviors. According to the committee, part of the additional revenue generated will be allocated to public health initiatives, hospital funding, and preventive education programs.

Interestingly, the proposed legislation would also establish a new 8% Special Tax on Production and Services (IEPS) for video games containing violent content, which is a category that had previously been exempt. The IEPS targets goods and services considered detrimental to public welfare, such as tobacco, alcohol, gambling, and now, violent video games.

The proposed tax increase has been a topic of discussion in the country for some time now. It was last month when it was proposed to increase gambling taxes to 50%, a move that the industry seems discontent with, but one that aligns with what many other countries have also done in recent years. 

The Chamber of Deputies approved the proposal earlier this month, and it now moves to the Senate for debate and a plenary vote before the October 31 deadline. If passed without amendments, the legislation will be published in the Official Gazette of the Federation (DOF) and will take effect on January 1, 2026.

What’s the Government’s Reasoning for the Substantial Tax Increase?

Lawmakers argued that the state has a constitutional obligation to protect citizens’ health and to ensure that tax revenues are reinvested to reduce social inequality. The chair of the Senate’s First Committee on Legislative Studies emphasized that these measures should be understood as an exercise in public responsibility, rather than a response to industry opposition.

During Tuesday’s session, the committee stressed that the tax increases were neither arbitrary nor politically driven, but consistent with international fiscal practices aimed at promoting population health. Members also emphasized the need for full regulation of online betting and gaming within Mexico, seeking to end what they described as a pattern of foreign operators earning profits domestically without contributing to the national tax base.

Additionally, officials say the proposed tax hike is intended to boost revenue and help narrow the budget deficit, projected at 4.1% of GDP. The measure also aims to bring gambling in line with other socially harmful activities already subject to taxation, such as tobacco and sugary drinks. All of these sectors are taxed both to raise funds and to mitigate their social impact.